Uncollectable Accounts and HST

by Kyle
(St Catharines Ontario)

How to handle GST/HST when writing off of a bad debt

How to handle GST/HST when writing off of a bad debt

If the HST collected (on the sale) has already been paid to Canada Revenue, but eventually it was determined that the client's account would have to be written off, what would be the proper entry in the books to reclaim the HST.

Obviously the government owes back the money (I believe they do because I was never actually able to collect the cash). I will debit Uncollectible Accounts Expense, and credit Accounts Receivable. But how to deal with the HST?

Thank you in advance for your help!

Hey Kyle,

Check out my chat on bad debt. In the chat there is a section on how it affects GST / HST.

Briefly, when you do your write-off reverse the amount of HST that was invoiced. The bookkeeping entry required is also discussed in the same chat. As the chat points out, you have to decide if you are following GAAP procedures or Tax-basis procedures. I explain how to book both types of procedures.

If you use QuickBooks, the best way to do your write-off is to use the Credit Memo button.

P.S. Absolutely beautiful picture. Where was it taken?

Comments for Uncollectable Accounts and HST

Click here to add your own comments

Mar 01, 2014
by: Kyle Janz

It was a powerpoint that a friend sent me. No mention of where the pic is from but I'd sure love to be there (looks warmer than here)!

Click here to add your own comments

Return to GST HST.

Enjoy A Tea Break With
Me Today. Let's Chat!

Use the search feature to quickly find the
information you're looking for.

 Keep Your  eDocuments Safe And Secure… $7 USD
Version 2 now out
Bigger and Better

Your Learning Curve!


Warm up your tea cup and check out these chats ...

Click on image above to read the chat.

Purchasing These Products Through My Links Helps To Support This Site

Click on image above for my review.

Join Me On Facebook

Help support this site by "liking" me! Here's where I post current information.

Listed Under Websites NOT Local Business.
This website is not associated with the business operating in Bonnyville AB.

A Handy Reference