Crucial Clarifications on GSTR-2B, ITC Flow, and Credit Notes.

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GST IMS Advisory: What Changes and What Stays the Same?

Following the impending rollout of the Invoice Management System (IMS), GSTN has issued a clear advisory to dispel rumors about major procedural overhauls. Taxpayers must note that the fundamental ITC flow remains secure, while new flexibility is introduced for Credit Notes, effective from the October 2025 tax period.


Key Clarity I: ITC Auto-Population is Unchanged

No Manual Intervention Required.

  • ITC Flow: Input Tax Credit (ITC) will continue to auto-populate from GSTR-2B to GSTR-3B seamlessly.

  • IMS Impact: The implementation of the Invoice Management System (IMS) does not affect this core auto-population mechanism.

Key Clarity II: GSTR-2B and Regeneration

  • Generation: GSTR-2B will still be generated automatically on the 14th of every month.
  • Post-14th Actions: Taxpayers can take actions in IMS (e.g., acceptance/rejection) even after the 14th, until GSTR-3B is filed.
  • Flexibility: Taxpayers can regenerate GSTR-2B if necessary to reflect these latest actions before filing GSTR-3B.

Key Clarity III: Credit Note Flexibility (Oct 2025 Onward)

Critical New Option for Recipients.

  • Pending Option: Recipients can now keep Credit Notes pending for a specified period.
  • Adjustable Reversal: On acceptance, recipients gain the flexibility to manually adjust the reversal amount, ensuring ITC is reduced only to the extent of its actual availment. This prevents excess reversal due to a technical Credit Note entry.

Professional Insight: Key Takeaway 💡

The system's core stability is confirmed. The most significant benefit is the manual adjustment option for Credit Note reversals. Finance teams must update their processes to leverage this feature, ensuring ITC reversal is limited strictly to the actual credit previously availed, thereby protecting working capital.

Source: Advisory by Team GSTN, Dated October 8th, 2025.

Location: Vijayawada, Andhra Pradesh, India

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