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In the realm of GST compliance, timing and ambiguity are of great importance. Every single invoice impacts your ITC calculations – which affects your monthly returns. A business’s expenses under ITC also include ambiguous invoices that have some semblance of eligibility.
For the sake of example, if there is no explicit clarity, ITC is claimed on an invoice which later turns out to be ineligible. This results in credit, but an excess incentive credit, thus resulting in interest payment.
Such actions from the latest IMS in GST are beneficial. Instead of rushing to settle invoices with a need for deeper examination or critique, you can solve them later without any imposing time constraint. Marking such invoices as Pending enables pausing action and pre-emption of unwanted resolution. This ensures that payments don’t get affixed to invoices in GSTR-2B or their ITC pool.
We are going to cover in detail what Pending invoices entail, why you may want to mark them, and why mark them in the first place.
Pending invoice is a classification within IMS which might be defined as temporarily held for decision pending accept or reject. In every, this setting can be helpful when:
A Pending invoice is one that’s temporarily held back from being accepted or rejected in the IMS. Permit me correct myself for set without permission envelope not set without permission envelope not set without permission umbrella without no set without permission umbrella without boundary border unlock prata unlock umbrella unlock invitation sets knot free.
Pending invoice is one which is kept on hold in IMS whether it’s accepted or rejected. You can apply this status when:
The explanation provided enables you to manage the workflows without blocking the invoices, and at the same time, keeping them in your system. That is why you are able to discard the unnecessary leap of logic that is so often added to your revenue calculation worksheet.
Repaying an invoice in installments can be done anytime before the 14th of a month when draft GSTR-2B is generated.
Accomplishing this goal enables you to:
Every invoice not acted upon by the 14th is presumed accepted and incorporated in the Draft GSTR-2B. The buyer is still permitted to mark the invoices pending after 14th but before the GSTR-3b return filing deadline. In such cases, the buyer needs to recompute the GSTR-2B before filing the GSTR-3B return.
Here’s a mechanical follow up on the Pending invoice wheel in IMS:
This action allows full control over ITC claims.
GSTR-2B and GSTR-3B: Impact of marking as pending
Pending invoice functions affect GST returns reflect on results pages:
Action | GSTR-2B Impact | GSTR-3B ITC Impact |
Pending | Not included in the current month Yes | Not included in the current month No ITC will be considered |
When pending invoice is accepted | 2B will be for sure included this month | 3B will also be yes included electronically switch off for supports will be YES this month |
If you reject it instead set accepted | includes it will but only under “ITC rejected” section introduction box of GSTR-2B | Would not use, will not be carried forward for sure pass the it |
By marking the invoice as Pending, it means all necessary requirements still need to be completed prior to claiming the ITC.
Now let’s discuss some scenarios wherein marking an invoice as Pending aligns with practical situations.
Goods still Awaited
Take this scenario: An invoice is received on the 30th of June, but the goods are expected to arrive on the 3rd of July. You are still not in a position to claim ITC until the goods are in your possession. In this case, mark invoice as Pending to prevent drawing an early claim.
Waiting on Approvals
A subordinate has entered some accounts and a finance manager has to cross validate some of the entries. While waiting for the approval of the relevant documents, marking the invoice as Pending is the most useful option.
Doubt concerning the eligibility of ITC on the invoice
In cases wherein the invoice encompasses items of both corporate use as well as personal, like a home laptop, and there is uncertainty about how much ITC can be claimed, marking it pending is ideal as review will be done later.
Selection of Pending status in IMS doesn’t mean a decision is being put on hold. Rather, it gives a chance for the claimant to make well thought out decisions. If a user is waiting for goods, clarifications, or for an internal review, this option allows them to respond when it makes the most sense while still being compliant.
Next time you encounter an invoice which you are not too sure about, put it in Pending status. It’s a simple action, but can help make certain that GST filings are precise, clean, and audit ready.
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