Handling Uncollectible Receivables When Calculating Corporate Income Tax

Bich Hoa

21:01, 10/07/2024

On August 8, 2019, the Minister of Finance issued Circular 48/2019/TT-BTC providing guidance on the establishment and handling of provisions for devaluation of inventory, losses from investments, bad debts, and product warranties, goods, services, and construction works in enterprises.

When dealing with bad debts that are not recoverable, the enterprise must prepare the following documents:

- Minutes of the Enterprise Debt Settlement Council. This document should specify the value of each bad debt, the value of the recovered debts, and the actual loss value (after deducting the recovered amounts);- A detailed list of the written-off bad debts to serve as a basis for accounting. Accounting books, vouchers, and documents proving that the debt has not been recovered, up to the time of debt settlement, the enterprise is still accounting for the receivable debt on the enterprise's accounting books;- Records and documents related to the implementation of provisions for bad debts that are not recoverable.

Refer to other regulations at Circular 48/2019/TT-BTC effective from October 10, 2019.

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