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    Corporation tax - Chargeable profits - Specific income and expense items - Expense items - Impairment losses - 3540

    To be deductible an impairment loss (also known as a bad debt) must be incurred in the course of the business. This means that an irrecoverable trading debt will be deductible, whereas an irrecoverable...

    Corporation tax - Other income and expenses - Intangible assets - Corporation tax code - 7440

    The regime is, in practice, fairly straightforward as certain debits (expenses), credits (income) and gains recognised in the company accounts for qualifying intangible assets are also allowed...

    Corporation tax - Other income and expenses - Loan relationships - Special situations - Impairment losses (bad debts) - 7935

    Where a company prepares its accounts in accordance with an acceptable accounting method (¶7835), it is required to assess its financial assets at each balance sheet date and to see whether...

    Value added tax - Routine VAT - Bad debts - 81360

    VAT is usually accounted for when a supply is made. If the debt in respect of a supply is not paid, the supplier may claim bad debt relief equivalent to the output tax paid to HMRC, provided...

    Value added tax - Routine VAT - Cash accounting scheme - Special situations - Outsourcing debt collection - 81615

    Where the debts of a business are collected by an agent, VAT must be accounted for in the period in which the agent receives the payment. VAT is due on the full amount received by the agent from...

    Value added tax - Special accounting methods - Retail schemes - Using a retail scheme - Calculation elements - Expected selling price - 83520

    At the end of the VAT period the retailer should review the selling prices by taking into account: - price changes (particularly in respect of perishable goods which must be sold by a certain...

    Value added tax - Administration - Records - Other records - 87060

    In addition to the VAT account, all traders must maintain the following records: - general business and accounting records; - copies of all VAT invoices issued and received; - a record of any...

    When should you deduct bad debts?

    Your firm’s financial year ends soon and while the accounts will show a profit you’re expecting them to include significant bad debts. How long will you have to wait to claim a tax deduction...

    Maximising corporation tax relief for bad debts

    Your client’s company accounts show a number of small bad debts. Individually these don’t merit chasing and the client is looking to write them off. Do they need to do anything particular...

    VAT flat rate scheme users missing out on bad debt relief

    If a customer fails to pay your invoice you can, after six months, claim a refund of the corresponding VAT you accounted for to HMRC. But if you use the flat rate scheme a further adjustment...