Write Off Bad Debts To Reduce Tax
In a scenario where you have provided a service to someone and they refuse to pay despite your efforts to resolve the matter, it may be wise to consider writing off the unpaid invoice instead of dwelling on it. By doing so, you can claim it as a deduction in the same tax year instead of keeping it as a receivable on your books.
However, it’s important to note that you shouldn’t write it off too soon. If you haven’t exhausted all possible means of recovering the debt, it may not be appropriate to write it off. But if you have taken all necessary steps, then you can proceed with writing it off and claiming the deduction.
https://inspire.accountants/chat/If you’re keen to explore changing accountants, we have a non-obligation process to do that. The first step is booking a strategy call with one of our accounting team. It’s a free 20-minute zoom or phone call where you get to meet us to manage your questions.
From that point, you can consider doing a “Look Under The Hood” with us. There is no obligation to change accountants, but we give you a second opinion if you’re paying too much tax.
Throughout that process, we can identify any problems we see with your current setup. Anything that your current accountant hasn’t claimed, or tax you may have overpaid, and strategies of how we might fix that going forward. We can run through with you once you book with us.
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