When you know that a debt will not be recovered, you need to write it off. Before you can write off a bad debt, you need to create a Bad Debt expense account in your accounts list. For more information on creating accounts, see ‘Easy setup assistant’.
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In the Description field, type a description of the transaction.
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In the Acct No. field, type or select the account for Bad Debts.
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In the Amount field, type the bad debt amount as a negative number.
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In the Tax field, type or select the required tax code.
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Click Record.
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In the Settle Returns & Credits window, apply the credit against the original open invoice. For more information, see ‘Settling credits’.
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