Print GST Bad Debt Relief

GST Bad Debt Relief

Introduction

A taxable person may claim bad debt relief subject to the requirements and conditions set forth under sec.58 of the GSTA 2014 and the person has not received any payment or part of the payment in respect of the taxable supply from the debtor after the sixth month from the date of supply.

The bad debt relief may be claimed if -
(a) requirements under s.58 GSTA and Part X of GST Regulations 2014 arefulfilled; and
(b) the supply is made by a GST registered person to another GST registered person

The bad debt relief shall be claimed immediately in the taxable period after the expiry of the sixth month from the date of supply.

If the bad debt relief is not claimed by the supplier in the immediate taxable period immediately after the expiry of the sixth month, then the taxable person has to notify the Director General (DG) within 30 days after the expiry of the sixth month on his intention to claim at a later date.

A GST registered person who has made the input tax claim but fails to pay his supplier within six months from the date of supply shall account for output tax immediately after the expiry of the sixth month (s.38(9) GSTA).

The word ‘month’ in sec.58 refers to calendar month or complete month –
Example: Invoice issued at 15 th January 2017. For monthly taxable period, the sixth month expires at the end of June and the bad debt relief shall be claimed in July taxable period.

See below the overview of GST Bad Debt Relief system flow:

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Check List related to Bad Debt Relief

Maintain Tax

[GST | Maintain Tax...]

Below tax code will be AUTO used for Bad Debt Relief matter when process GST Return:

Tax Code	Description	Tax Acc Entry	Explanation
PH-AJP-BD	Input Tax adjustment e.g: Bad Debt Relief	DR GST-Claimable CR GST-Purchase Deferred Tax	For supplier bad debt relief recovered
SL-AJP-BD	Input Tax adjustment e.g: Bad Debt Relief	DR GST-Claimable CR GST-Sales Deferred Tax	For customer bad debt relief claim
PH-AJS-BD	Output Tax adjustment e.g: Bad Debt Recover, outstanding invoice > 6 months	DR Sales Deferred Tax CR GST-Payable	For customer bad debt relief recovered
SL-AJS-BD	Output Tax adjustment e.g: Bad Debt Recover, outstanding invoice > 6 months	DR GST-Purchase Deferred Tax CR GST-Payable	For supplier bad debt relief payable

Maintain Customer

[Customer | Maintain Customer...]

There is one condition to determine the bad debt relief can be claimed if -
(a) requirements under s.58 GSTA and Part X of GST Regulations 2014 arefulfilled; and
(b) the supply is made by a GST registered person to another GST registered person

THerefore, you need to update the GST No for your customer who is GST registered person. See the screenshot below.

Under the Tax tab in Maintain Customer,

GST Listing

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GST-03

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GST Bad Debt Relief

[GST | Print GST Bad Debt Relief…]

1. This report is help you to analyse the GST Bad Debt Relief happenings on each invoices.

2. For instance,
Let said the IV-00109 has the following details:-

Seq	Description	Amount	Tax	Tax Amount	Amount with Tax
1	Sales of coconut can drinks	1,000.00	SR	60.00	1,060.00
2	Sales of coconut	1,000.00	ZRL	0.00	1,000.00

3. From the below report, it tells you that the bad debt relief claimed and to be recover at Rm30.87 for IV-00109. You can found at the detail that the bad debt relief claimed at Taxable Period 01 Oct 2015 to 31 Oct 2015

4. After the IV-00109 has been full settlement in month Nov 2015, you will found the full tax paid Rm60 and to be recover will be shown as 0. You can found at the detail that the bad debt relief recovered at Taxable Period 01 Nov 2015 to 30 Nov 2015

5. There are some option can choose to apply the GST Bad Debt Relief for further checking:

Sales

Options	Explanation
Bad Debt Relief Claimed	GST bad debt relief that you HAVE TICKED to claim on outstanding invoices when process your GST returns.
Bad Debt Relief Not Claim	GST bad debt relief that you DO NOT TICKED to claim on outstanding invoices when process your GST returns.
Bad Debt Relief Not Happen	Outstanding invoices the GST Amount not expired at 6 months GST bad debt relief.
Include Zero Outstanding	To include the outstanding invoices are zero.

Purchase

Options	Explanation
Bad Debt Relief Paid	GST bad debt relief have paid on the outstanding supplier invoices when process your GST returns.
Bad Debt Relief Not Pay	GST bad debt relief not pay yet on the outstanding supplier invoices. It could be due to late receive the supplier invoice.
Bad Debt Relief Not Happen	Outstanding invoices the GST Amount not expired at 6 months GST bad debt relief.
Include Zero Outstanding	To include the outstanding invoices are zero.

NOTE :
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