Share this content

bad debt or not

bad debt or not

Didn't find your answer?

UK resident client has completed some work for a US company and was paid after a short delay, in US dollars. Client banked the payment into US bank which promptly folded. So he is now waiting to see what the position is with the US bank authorities and whether he will ever receive the payment (or maybe a percentage of it). Strictly this does not look like a bad debt as he WAS paid by his client. Are there any tax cases or regulations that can help him out if the fees are lost for good?

Replies (2)

Please login or register to join the discussion.

By aland
14th Dec 2015 23:00

Surely it is a bad debt from the bank, but he probably can't claim against it until he knows how much (if any) he will get. I guess he can provide for it though.

Thanks (0)
By Ruddles
14th Dec 2015 23:11

Forget about the customer

The relevant (loan) relationship is now with the bank - that is the debt that you need to consider for impairment recognition.

Thanks (0)
Share this content

Related posts