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Bad debts - when can you deduct?
Did you know that you could write off a debt that is not necessarily bad in the strict legal sense?
However, you must make a bona fide assessment, based on sound commercial considerations, of the extent to which the debt is bad and importantly this decision is documented in some form of written record. It is a question of fact when a debt is bad and some reasonable steps should be taken to prove the commercial decision mentioned above.
Some other rules must be satisfied before claiming a bad debt deduction. Please contact us on 02 9957 4033 if you need any assistance and we can review your debtor position as part of our year-end tax planning.
Want more tax tips? Follow us @batescosgraveCA
Did you know that you could write off a debt that is not necessarily bad in the strict legal sense?
However, you must make a bona fide assessment, based on sound commercial considerations, of the extent to which the debt is bad and importantly this decision is documented in some form of written record. It is a question of fact when a debt is bad and some reasonable steps should be taken to prove the commercial decision mentioned above.
Some other rules must be satisfied before claiming a bad debt deduction. Please contact us on 02 9957 4033 if you need any assistance and we can review your debtor position as part of our year-end tax planning.
Want more tax tips? Follow us @batescosgraveCA
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Disclaimer
The material and contents provided on this website and in our print, email or downloadable publications are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained. Liability limited by a scheme approved under Professional Standard Legislation.
The material and contents provided on this website and in our print, email or downloadable publications are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained. Liability limited by a scheme approved under Professional Standard Legislation.
