<?xml version="1.0" encoding="utf-8"?>
<ManualTopic ID="/baanerp/tf/onlinemanual/000200" xml:lang="en">
   <Header>
      <Title>Bad Debts Relief</Title>
   </Header>
   <AimSection>
      <Paragraph>If the customer does not pay the supplier, input tax credit must
		be adjusted as output tax. In case, the customer does not pay the output tax,
		the liability has to be adjusted as input tax credit.</Paragraph>
      <Paragraph>The relief for bad debt for a taxable supply is availed
		if:</Paragraph>
      <List>
         <ListItem>the payment of the taxable supply is not received within six
		  months from the date of supply.</ListItem>
         <ListItem>the other party is declared insolvent within six months from
		  the date of supply.</ListItem>
      </List>
   </AimSection>
   <Note>
      <SectionTitle>Note</SectionTitle>
      <Paragraph>The bad debt relief can be availed only if efforts to recover
		the debt, have been unsuccessful. It is important to disclose documentary proof
		that efforts had been made to recover the debt.</Paragraph>
   </Note>
   <GeneralSection>
      <SectionTitle>Bad Debts Adjustments by Customer</SectionTitle>
      <Paragraph>The bad debts to be written off is based on the invoice in the <GUIRef href="/baanerp/tf/acr/tfacr2240m000" role="session">Write Off Payment Differences (tfacr2240m000)</GUIRef> session. You can write off the bad debt
		using the <GUIRef href="/baanerp/tf/acr/tfacr2240m00c" role="session">Bad Debts relief - Customer (tfacr2240m00c)</GUIRef> session. To write off the payment
		differences, the invoice must be generated within six months or before in the <GUIRef href="/baanerp/tf/acr/tfacr2240m000" role="session">Write Off Payment Differences (tfacr2240m000)</GUIRef> session. The supplier can claim the bad
		debt relief as input tax in the return for the taxable period.</Paragraph>
   </GeneralSection>
   <ConceptSection>
      <SectionTitle>Example</SectionTitle>
      <Paragraph>If the <GUIRef href="/baanerp/tf/acr/tfacr2240m00c#g.gst.amount.only" role="manual">GST Amount Only</GUIRef> check box is selected in the <GUIRef href="/baanerp/tf/acr/tfacr2240m00c" role="session">Bad Debts relief - Customer (tfacr2240m00c)</GUIRef> session, total amount of invoice is not
		written off and only amount to the extent of GST tax is written off. The
		posting is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="2">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">GST Adjustment for ACR <Paragraph>(Read from GST parameter)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
            <TR no="2" isLast="true">
               <TD rowspan="1" colspan="1">Bad Debts account <Paragraph>( Read from GST Parameter)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
         </TBODY>
      </TABLE>
      <Paragraph>Invoice value = MYR 1060, out of which Sale is MYR 1000 and Tax
		is MYR 60. The actual postings is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="2">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Payment differences account <Paragraph>(From BP group other accounts)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
            <TR no="2" isLast="true">
               <TD rowspan="1" colspan="1">Customer control account <Paragraph>(From BP group control account)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
         </TBODY>
      </TABLE>
   </ConceptSection>
   <Note>
      <SectionTitle>Note</SectionTitle>
      <List>
         <ListItem>If the partial amount is written off, the tax amount is
		  calculated proportionately.</ListItem>
         <ListItem>If the amount is paid at a later date, the posting must be
		  reversed in the period the amount is paid.</ListItem>
      </List>
   </Note>
   <ExampleSection>
      <Paragraph>When the invoice is written off, posting is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="3">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Payment differences account <Paragraph>(Read from GST Parameters)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">1000.00</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">GST Adjustment for ACR <Paragraph>(Read from GST Parameters)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
            <TR no="3" isLast="true">
               <TD rowspan="1" colspan="1">Customer control account <Paragraph>(From BP group control account)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
         </TBODY>
      </TABLE>
   </ExampleSection>
   <GeneralSection>
      <SectionTitle>Bad Debts Adjustments by Supplier</SectionTitle>
      <Paragraph>If a customer fails to make payment to a supplier within six
		months from the invoicing date, the supplier must credit or claim refund for
		the input tax; which is paid as output tax at the time of sale. The supplier
		must include the deemed output tax in the GST return. This output tax must be
		included in the next taxable period which falls immediately; after the six
		months period. Subsequently when the payment is made, the GST amount paid, can
		be claimed.</Paragraph>
   </GeneralSection>
   <Note>
      <SectionTitle>Note</SectionTitle>
      <Paragraph>To write off the payment differences for an invoice using this
		session, the invoice must be generated six months or before in the <GUIRef href="/baanerp/tf/acp/tfacp2230m000" role="session">Write Off Payment Differences (tfacp2230m000)</GUIRef> session.</Paragraph>
   </Note>
   <ExampleSection>
      <SectionTitle>Example</SectionTitle>
      <Paragraph>Invoice value = 1060, out of which Goods value is 1000 and Tax
		is 60. Actual postings is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="2">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Supplier control account <Paragraph>(From BP group control account)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
            <TR no="2" isLast="true">
               <TD rowspan="1" colspan="1">Payment differences account <Paragraph>(From BP group other accounts)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
         </TBODY>
      </TABLE>
      <Paragraph>When the invoice is write off, the posting is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="3">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Supplier control account <Paragraph>(From BP group control account)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">1060.00</TD>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">Payment differences account <Paragraph>(Read from GST Parameters)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">1000.00</TD>
            </TR>
            <TR no="3" isLast="true">
               <TD rowspan="1" colspan="1">GST Adjustment for ACP <Paragraph>(Read from GST Parameters)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
         </TBODY>
      </TABLE>
   </ExampleSection>
   <ConceptSection>
      <Paragraph>If the <GUIRef href="/baanerp/tf/acr/tfacr2240m00c#g.gst.amount.only" role="manual">GST Amount Only</GUIRef> check box is selected in the <GUIRef href="/baanerp/tf/acr/tfacr2240m00c" role="session">Bad Debts relief - Customer (tfacr2240m00c)</GUIRef> session, the total invoice amount is not
		written off and only the amount to the extent of the GST tax is written off.
		The posting is:</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="2">
            <TR no="1" isLast="false">
               <TD rowspan="1" colspan="1">Bad Debts account <Paragraph>( Read from GST Parameter)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Debit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
            <TR no="2" isLast="true">
               <TD rowspan="1" colspan="1">GST Adjustment for ACR <Paragraph>(Read from GST parameter)</Paragraph>
               </TD>
               <TD rowspan="1" colspan="1">Credit</TD>
               <TD rowspan="1" colspan="1">60.00</TD>
            </TR>
         </TBODY>
      </TABLE>
   </ConceptSection>
   <Note>
      <SectionTitle>Note</SectionTitle>
      <List>
         <ListItem>If the partial amount is written off, the tax amount is
		  calculated proportionately.</ListItem>
         <ListItem>If the amount is paid at a later date, about posting must be
		  reversed in the period the amount is paid.</ListItem>
      </List>
   </Note>
   <GeneralSection>
      <Paragraph>This table lists the tax account and tax code information that
		is updated in the GST 03 form.</Paragraph>
      <TABLE border="1" borderstyle="default" space-and-orientation="indented-estimated">
         <TBODY noTR="7">
            <TR no="1" isLast="false">
               <TH rowspan="1" colspan="1">Transaction</TH>
               <TH rowspan="1" colspan="1">Tax
				Account</TH>
               <TH rowspan="1" colspan="1">Tax Code</TH>
               <TH rowspan="1" colspan="1">Column in GST-03</TH>
            </TR>
            <TR no="2" isLast="false">
               <TD rowspan="1" colspan="1">Actual
				Purchase</TD>
               <TD rowspan="1" colspan="1">Input Tax</TD>
               <TD rowspan="1" colspan="1">TX</TD>
               <TD rowspan="1" colspan="1">6b</TD>
            </TR>
            <TR no="3" isLast="false">
               <TD rowspan="1" colspan="1">Not paid
				within 6 months GST write off</TD>
               <TD rowspan="1" colspan="1">Output
				Tax</TD>
               <TD rowspan="1" colspan="1">AJS</TD>
               <TD rowspan="1" colspan="1">5b</TD>
            </TR>
            <TR no="4" isLast="false">
               <TD rowspan="1" colspan="1">Paid after 6 months</TD>
               <TD rowspan="1" colspan="1">Input
				Tax</TD>
               <TD rowspan="1" colspan="1">AJP</TD>
               <TD rowspan="1" colspan="1">6b</TD>
            </TR>
            <TR no="5" isLast="false">
               <TD rowspan="1" colspan="1">Actual Sales</TD>
               <TD rowspan="1" colspan="1">Output
				tax</TD>
               <TD rowspan="1" colspan="1">SR</TD>
               <TD rowspan="1" colspan="1">5b</TD>
            </TR>
            <TR no="6" isLast="false">
               <TD rowspan="1" colspan="1">Customer not paid in 6 months - gst
				write off</TD>
               <TD rowspan="1" colspan="1">Input tax</TD>
               <TD rowspan="1" colspan="1">AJP</TD>
               <TD rowspan="1" colspan="1">6b</TD>
            </TR>
            <TR no="7" isLast="true">
               <TD rowspan="1" colspan="1">Customer
				paid after 6 months</TD>
               <TD rowspan="1" colspan="1">Output
				tax</TD>
               <TD rowspan="1" colspan="1">AJS</TD>
               <TD rowspan="1" colspan="1">5b</TD>
            </TR>
         </TBODY>
      </TABLE>
   </GeneralSection>
</ManualTopic>