Cash basis return for bad debts
I may have a new accounting client who has not done her 2010/2011, or 2011/2012 tax return. Tut tut.
In 2010/2011, they invoiced their client (april to dec) a total of £50K. During the year they only received £20K of it. No payments received against this debt in 2011/2012 and in 2012/2013 the company is potentially putting this debt into a CVA.
Now - we need to play catch up with the 2010/2011 tax return which will show income of £50K and potentially the 2011/2012 will show a bad debt cost of £30K. It seems unfair to have to pay tax on money never received.
So my question then is, could my client do the 2010/2011 tax return on a cash received basis, and if she ever receives any payment on the rest of the income, declare that in the tax year of receipt?
Thank in advance.
- can I claim a per diem 107 1
- Whats the best way to keep my accounts? 374 11
- How do I clear transaction history - Sage 50 v9 207 5
- Ltd co client preparing own self assessment tax returns 288 8
- Business Christmas Greetings 743 17
- Dispensation pointless ? 424 10
- When will Private Principal Residence Relief cut will start? 463 11
- SME Direct Debit 715 12
- Aweb Fantasy Practice 1,027 18
- Land Opt to Tax - VAT scope 153 6
- Personal returns late information - when to get tough? 684 9
- Is anyone a member of National Accountancy Network? 303 6
- Running Cost of Private Car more than 45p per mile?? 286 7
- r&d payable tax credits 63 1
- Fee agreed but client disagrees on amount 439 3
- CIS gross status review 186 2
- Can rental income ever be trading income? 160 2
- Playstation 4 - Allowable expense or not? 2,137 26
- Dividend paid to non-shareholder 390 10
- Claiming pension relief 84 1
- Desperately seeking Susan, Sam or anyone with any other name 793
- Experience with Islamic investor following Sharia-compliant rules? 494
- Darwinpay Partnership Assessment 306
- How to format a stock book 275
- S464A Charge to tax: conferring benefit & BIK 223
- Tax efficient holding company structure 215
- Outlook 2007 with business contact manager not loading on new laptop 204
- Investment property company accounts template 195
- auto enrolment - calculation of first pension deduction 178
- Sage 50 Customer Statements and Running Balances 169