Bad Debt Recovery

After the bad debt is relieved and the payment is received, use the Process Bad Debt Recovery (tfacr2216m000) session to recover bad debt relief. Prerequisite is that the transactions of all involved receipts or assignments of receipts to invoices must be finalized.

You can specify the Tax Period in the Process Bad Debt Recovery (tfacr2216m000) session. The payments that are received in this period is selected for recovery. To post the bad debt recovery transactions, select the Post Bad Debt Recovery check box. The Document Date and the Fiscal Period of the bad debt recovery must be specified to post the transactions in the given fiscal, reporting, and tax period. This process is mandatory in countries such as Malaysia and UK to recover tax for receipts or payments made on invoices that are previously relieved for bad debt. This process creates Bad Debt Recovery for all the selected documents that are previously relieved and for which receipts or payments are created.

After the process is initiated, a batch with the Bad Debt Recovery documents can be created. The Bad Debt Recovery Transactions are generated automatically for each relieved invoice and receipts/payments.

Note: The recovery transactions for multiple invoices can be linked to one document, but when too many transaction lines are to be written, a new document number is generated.

If the Adjust Tax for Deductions check box is selected in the CMG Parameters (tfcmg0100s000) session, a relieve never results in a tax deductible amount.