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• # 72044
• Sun 12 Jun 2011 07:13 AM

Hi

I wonder if someone could please explain - i have gone through a question which mentions bad debt being written off, now i thought that as the transaction was relating to sales or a non sale, that any adjustment would be to negate the output tax on the vat form - the answer stated that the adjustment would be on the input tax side.

Any guidance would be appreciated.

Regards

Martin

• "Helping small acorns become large oaks"
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• # 72046
• Sun 12 Jun 2011 10:06 AM

Hi Acorn - this is one of these 'strange but true' ones.

http://www.hmrc.gov.uk/vat/managing/reclaiming/bad-debts.htm

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• # 72047
• Sun 12 Jun 2011 10:21 AM

Hi Martin,

Would you mind advising what mock  it is?
I understood you are asking a question about a mock, should it not be the case please clarify.

More info on the question would  help us to help you.

Nathaliexxx

• Provide bookkeeping and virtual accountancy assistance service in English and French @nckaccountancy.
  West Essex Twitter:http://nckaccountancy.co.uk
  E-mail: info@nckaccountancy.co.uk
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• # 72048
• Sun 12 Jun 2011 10:26 AM

Hi Martin,

Would you mind advising what mock  it is?
I understood you are asking a question about a mock, should it not be the case please clarify.

More info on the question would  help us to help you.

Nathaliexxx

• Provide bookkeeping and virtual accountancy assistance service in English and French @nckaccountancy.
  West Essex Twitter:http://nckaccountancy.co.uk
  E-mail: info@nckaccountancy.co.uk
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• # 72049
• Sun 12 Jun 2011 10:34 AM

Hi Martin,

Would you mind advising what mock  it is?
I understood you are asking a question about a mock, should it not be the case please clarify.

More info on the question would  help us to help you.

Nathaliexxx

• Provide bookkeeping and virtual accountancy assistance service in English and French @nckaccountancy.
  West Essex Twitter:http://nckaccountancy.co.uk
  E-mail: info@nckaccountancy.co.uk
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• # 72051
• Sun 12 Jun 2011 11:06 AM

Hi Liz and Natalie

Thanks Liz for the link

Natalie -  it is question 2 from February 2010 manual level 2 paper - the idea was to correct the vat return as required.

As the bad debt was a sale for which we would no longer receive any money i have amended the sales vat whereas the answer altered the purchases vat.

Many thanks

Martin




Martin

• "Helping small acorns become large oaks"
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• # 72053
• Sun 12 Jun 2011 11:20 AM

Hi Liz and Natalie

Thanks Liz for the link

Natalie -  it is question 2 from February 2010 manual level 2 paper - the idea was to correct the vat return as required.

As the bad debt was a sale for which we would no longer receive any money i have amended the sales vat whereas the answer altered the purchases vat.

Many thanks

Martin




Martin

• "Helping small acorns become large oaks"
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• # 72057
• Sun 12 Jun 2011 11:41 AM

oh - i should just say that the amount to pay HMRC would be the same - i am assuming that in the exam this would be marked down

also if i made an error on one part of a question but everything else was ok would i get marked down on the whole question?

regards

Martin

• "Helping small acorns become large oaks"
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• # 72062
• Sun 12 Jun 2011 01:41 PM

Nathalie

Please dont take offence at this, however the question Martin asked was answered using the link.  Hence why I wrote 'strange but true'

The HMRC link explains that Input tax should be adjusted when claiming for Bad Debt.

Kind regards

Liz

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• # 72191
• Tue 14 Jun 2011 10:48 PM

LOL Martin

The same question scuppered me, I was raging. The thing is I can also see the logic in putting it in the input vat as bad debts does appear in the profit and loss account under expenses.

I even told a CA friend of mine and he looked surprised when I told him the answer.

Ta

Peter.

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• # 72196
• Wed 15 Jun 2011 06:05 AM

Hi Peter

Its interesting how things are not always as you think - i agree that there is logic to the bad debt being shown on the input side.

Certainly entertaining this bookkeeping journey!

Regards

Martin

• "Helping small acorns become large oaks"
• 
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