Self assessment (self employed) - how to enter a bad debt from a previous year

WilliamT

Not had a great deal of success phoning HMRC helpline for advice (they keep telling me I have to speak to a technician and none are free) so...

My accounts software is set to generate invoices on accrual (i.e. when I bill people rather than when I receive the money.)

In a previous tax year (i.e. the return has already been submitted) my turnover includes an invoice for £1,000 of which subsequently only half was paid.

Turnover is well below the (recently increased from £15,000) £30,000 threshold so I'm only completing the short version of the self-employment return - basically I need to know where I'm supposed to enter the £500 that I've written off.

Do I, for example, include it in the total allowable expenses (this is where my accounts software - Intuit Quickbooks - seems to suggest it goes). For < £30,000 turnover you're only obliged to give the total income, but if you choose the detailed breakdown option its not exactly obvious where to put it (there are plenty of entries for transport, insurance, wages, stationary etc. but there is no longer a 'Bad debts' box like there was on the form in previous years.)

I'm assuming the later boxes for Allowable losses work a bit like capital gains - e.g. if your business overall made a loss, and you want to carry that forward from previous years. My situation relates purely to one invoice that wasn't paid, so I'm ignoring those.

Thanks if you're able to help,
William

Jenny2008

Yes, I agree, I think you should put it in total allowable expenses, then use the 'any other information' box or whatever it's called to explain (cover yourself).

WilliamT

Thanks Jenny, I'll wait and see if anyone else replies as well. (Looking through other threads I see that there are occasions where people have to ask for their previous returns to be adjusted, but obviously there's rather more bureaucracy involved in that method..)

ceeforcat

Agree with Jenny - legitimate business expense. Wouldn't bother with the additional information entry though - don't see the need.