Practical VAT tips with bad debts

Neil Warren explains the bad debt relief rules for both suppliers and customers and shares a VAT saving tip with the flat rate scheme

Despite a general healthy economy, there are still many businesses that have suffered recent bad debts. They might have supplied goods or services to some of the high profile casualties that have gone into liquidation in recent years, a major travel company being the most recent example. There is nothing more frustrating for a business than a bad debt but the good news is that the VAT element of unpaid sales invoices should not be a problem if the relevant rules for bad debt relief are properly followed.