How to Write Off Bad Debts

Ensure you have an Expense – Transaction (GST Inclusive) GL code set up as Bad Debts in your financial chart.

Select Customers / Enter Adjustment

Select the Customer with the outstanding balance.

Enter the date on which it has been decided that the Invoice will be written off and considered a Bad Debt, a transaction reference, explanation, select the GL code Bad Debts and enter the amount to be transferred as a negative amount.

For example:

Select process, this will create a negative amount that can be received as a payment against the original Invoice in the Customer Payment screen.

Go to Customers / Customer Payment / Select the bank account / Select the Customer.

Receive the outstanding amount and the newly created adjustment at the same time which will result in a zero dollar transaction.