A retail client had £900 stolen with no prospect of recovery from insurer since the door was unlocked.
I think he still needs to treat it as VAT inclusive sales but has bad debt relief for income tax.
Dr Bad debts £750
Cr Sales £750
Cr VAT creditor £150
Does the remaining debit for £150 go to bad debts too? I need to know this before I can book it in Xero.