How do I mark an overdue invoice as a bad debt?

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1

How do we mark an invoice as unpaid and as a loss for the end of year accounts ?
so we can reconcile
for us basically it is easier, to write off the sum, rather than to continue to try and collect the unpaid amount. But we need it to be seen as a loss on the balance sheet.

2

Hi @CanterburyTaxis

If an invoice remains unpaid for a period of 6 months, a ‘Bad Debt’ button will appear on the invoice. Clicking this will write the invoice off for you.

I believe 6 months is the minimum time you have to wait, although you may wish to check with your accountant on this.

3

Thanks that is simple.

Can i suppose this will then appear on the balance sheet as a bad debt ?

4

What will happen, is eventually you’ll notice a ‘Mark as Bad Debt’ option in the ‘More Options’ menu:

You’ll be given the opportunity to give an effective date and confirm this option:

This creates an entry for the invoice value in 8100 Bad Debt Write Off:

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5

Many thanks problem solved.

1 Like
6

I don’t know if this has been resolved but a couple of years ago we had a client who sent a number of returns and then didn’t pay for what they had kept. The invoices that had been partially credited couldn’t be flagged as bad debts and we had to delete them and create separate invoices for the returned and non returned portions.

7

Hi @FolkLondon

I’ve made a note to test this in the morning. If we identify an issue here, I’ll certainly pass it over to our development team to take a look.

Thanks for letting us know