1. Home
  2. Getting Started
  3. Bad Debts (When you don’t get paid)

Bad Debts (When you don’t get paid)

Contents

Put simply, bad debts are when you don’t get paid by a client or customer.

It could be that you’ve provided a service and they fail to pay for whatever reason.

Bad debts cannot be claimed as a business expense as consultants use the Cash Basis accounting system – this means that you only record any income or expenses when the transaction takes place, and as no monies have transferred hands you haven’t actually received anything.

Updated on February 17, 2023

Was this article helpful?