Imagine you are a small-business proprietor who supplies goods and services to diverse clients each month. While your revenue is stable, delaying until the culmination of the quarter to report invoices could postpone your client’s input tax credit (ITC) claims. This can strain your business bonhomie and even lead to cash flow challenges. At this point, the Invoice Furnishing Facility (IFF) in GST comes to the fore, presenting an innovative solution to ease tax reporting.
With more than 1.39 crore GST registrants in India (according to the recent GSTN data), compliance is critical. The IFF portal in India was inaugurated to streamline GST returns for small businesses under the QMRP (Quarterly Return Monthly Payment) scheme. This facility allows eligible taxpayers to upload B2B invoices monthly, ensuring invoice compliance while lowering end-of-quarter filing workloads. Let’s delve into the specifics of IFF and the procedure for filing it.
Overview of IFF
As per the GST law, a recipient of goods or services can avail of ITC only when the supplier has uploaded the return on the website, i.e., has filed GSTR-1. However, a registered person who has utilized the QMRP scheme cannot upload invoices monthly, as he files the return quarterly.
To overcome this lapse in utilizing ITC, the government of India has launched IFF so that suppliers can upload invoices monthly, notwithstanding that returns are filed quarterly. It is especially advantageous for small businesses involved in B2B transactions, as it ensures their purchasers can claim ITC without waiting for quarterly GSTR-1 filings.
Conveniently, IFF is available to quarterly taxpayers in the QMRP scheme to file their particulars of outward supplies in the initial two months of the quarter so that the credit can be passed on to the recipient.
Main Features of IFF in GST
- Specific to QRMP Taxpayers: Only businesses within the QRMP scheme (turnover up to Rs 5 crore) can utilise the IFF.
- Enhanced ITC Claim for Purchasers: Aids purchasers in claiming GST invoice process credit before, lowering financial stress.
- Monthly Invoice Uploading: B2B invoices can be uploaded in the first two months of the quarter.
- No Late Fees or Interest: The IFF system does not charge penalties when users fail to use their filing capacity.
- The system allows users to upload invoices with a maximum value of Rs 50 lakh during each month.
- Businesses have the option to use IFF voluntarily since non-compliance will not result in penalties.
Example
A textile maker with an annual turnover of Rs 4.7 crore chose the QRMP scheme. Instead of waiting until the end of the quarter, they uploaded invoices worth Rs 30 lakh in January using the IFF portal in India. This lets their business clients claim input tax credit (ITC) in February, which improves business relationships and helps with cash flow.
Who Can Utilize IFF in GST?
The IFF portal India is built exclusively for taxpayers registered under the QRMP scheme. If your annual turnover is up to Rs 5 crore, and you file quarterly GSTR-1 and GSTR-3B, you can utilize IFF to record invoices in the first two months of the quarter.
Eligibility Criteria
- Picked the QRMP scheme
- Must be registered under GST in India
- Need to ensure prompt invoice compliance to aid buyers’ claim GST invoice process ITC
- Engaged in B2B dealings (not applicable for B2C sales)
Who cannot Utilize IFF?
- Businesses with a turnover over Rs 5 crore (who submit GSTR-1 monthly)
- Taxpayers who have not chosen the QRMP scheme
- Companies involved in only B2C transactions
Procedure for Filing IFF in GST
The enrolled person opting to register details through IFF will need to pursue the specified steps on the GST portal:
Step 1: Log in to the unified GST website using valid credentials.
Step 2: Manoeuvre to the ‘Services’ option, then ‘Returns’ and then ‘Returns Dashboard’.
Step 3: On the ‘File Returns’ page, pick the financial year and return filing period and select ‘Search’.
Step 4: Choose the ‘IFF’ option on the GSTR-1/IFF page.
Step 5: Select ‘Prepare Online’ or ‘Prepare Offline’ (if you wish to file returns offline), depending on your convenience, and upload JSON files to furnish the essential details.
Step 6: Select ‘Generate IFF Summary’ and then click the Submit button. Markedly, you cannot delete data after submission utilizing an online or offline tool.
Step 7: If you desire to file form GSTR-1, choose ‘File Return’, complete the details and select either DSC (Digital Signature Certificate) or EVC (Electronic Verification Code) to finish the process.
Due Dates for Filing IFF and Form GSTR-1
The registered person who has chosen IFF will have to adhere to the specified tabulated due dates for the respective months-
| Period | Form | Due Date |
| January | IFF | 13th February |
| February | IFF | 13th March |
| March | GSTR-1 | 13th April |
| April | IFF | 13th May |
| May | IFF | 13th June |
| June | GSTR-1 | 13th July |
| July | IFF | 13th August |
| August | IFF | 13th September |
| September | GSTR-1 | 13th October |
| October | IFF | 13th November |
| November | IFF | 13th December |
| December | GSTR-1 | 13th January |
Particulars to be Filed in IFF
The following are the details of invoices that are required to be provided by the Business while using Invoice Furnishing Facility (IFF):
- Invoice Date: Date on which the invoice is issued.
- Invoice Number: a unique number assigned to the invoice.
- Recipient’s GSTIN: GSTIN of the recipient of the supply.
- Description of Goods or Services: What was actually sold or provided.
- Amount of Taxes: Sales tax amount like SGST, CGST, IGST ,etc.
- Grand Total: Total amount of the invoice, including taxes
Businesses who provide this information ensure that their sales are correctly recorded and the consumer receives the tax credit he or she is entitled to. The lack of the required data results in the same purchase not being tax-deductible from the consumer side. Overall, offering complete and accurate information in the IFF upholds compliance with GST regulations.
IFF permits the filing of only B2B transaction particulars. Accordingly, the tables and matching details to be supplied through IFF are described hereunder-
| Tables covered under IFF | Matching details to be filed |
| 4A, 4B, 4C, 6B and 6C – B2B Invoices | Particulars concerning B2B transactions, i.e., goods or services or both, delivered to a registered taxable person. |
| 9A – Amended B2B Invoices | Amendment in details connected to the B2B supplies filed in the previous period return. |
| 9B – Debit Notes/Credit Notes (Registered) | Details concerning credit notes and/or debit notes granted to a registered person. |
| 9C – Amended Credit Notes/Debit Notes (Registered) | Amendment in particulars linked to credit/debit notes (issued to registered person) filed in the previous period return. |
Wrapping Up
The IFF in GST is a superb move to encourage taxpayers and clients to upload their invoices online for convenient payments. This tool will indirectly help taxpayers enhance their businesses by enabling faster ITC claims for their clients. However, this may increase their agreement costs. After the invoice bills are registered and noted on IFF, they are auto-populated in GSTR-1, making them non-editable and unable to be removed.
The data must be distinguished as non-B2B and B2B transactions for noting on the IFF. So, one has to weigh the benefits of opting for IFF against the associated expenses. It is qualified to opt in if the QRMP taxpayer records comparatively higher amounts of B2B invoices than B2C invoices in a quarter. Further, the impact on business associations with their registered clients must be interpreted well.
