Unfortunatly for business, we occasionally have clients that cant pay us ie the customer in in liquidation and the amount owed is not able to be collected.

In other cases the cost of pursuing the debt would outweigh the return so we chose not to pursue the amount.

How do we claim a tax deduction for this?

This video will show you how you claim a tax deduction for the amount that you are owned and how it will be reflected in your accounts and tax returns.

Remember to claim a bad debt it actually must be written off, that is you need to remove the invoice as being owing from your system and stop collection.

What happens if you get paid in the future, ie a small part from a liquidator, then this amount will be included as income when received.

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