Hi Markrich. Since 'Bad Debt' requires reversing sales tax and updating your income reports, the process is more intricate than a typical refund.
I recommend consulting an accountant to ensure your sales tax payable is adjusted correctly and that the loss is recorded in the right expense account. This keeps your books audit-ready and ensures you aren't paying taxes on income you never actually received.
If you have any additional concerns, please reach out to us again. We’re always here to help.
