Uncleared cheques

Uncleared cheques

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In the past, I have dealt with companies that have been paid twice for a sale which have never been claimed back by the customer.  The additional sale proceeds were treated as non taxable when the sales ledger was cleaned up as the receipt was not received as part of the trade of the business.

I now have the opposite in that the company has paid a number of cheques to suppliers and the cheques which are over 4 years old and total in excess of £20k, have not been cleared.  If I now clear up the suppliers ledger, I am wondering whether the write back of the uncleared cheques is now taxable.

Has anyone else  come accross a situation similar to this?

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By young ronaldo
11th Jan 2012 15:59

Credit to P&L and taxable.

Credit to P&L and taxable. Repay input tax.

With regard to being paid twice - i once went on a course that said this was a money laundering reportable event for the accountant as the client was aware that they had been paid twice and failed to return the money to their customer.

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