2098541 - No Corrective Tax Posting when Clearing Bad Debt Invoice due to Insolvency

• A customer of your Canada-based company is unable to settle an invoice due to insolvency and you need to reflect this in SAP Business ByDesign.
• To achieve this, you follow the directions provided in SAP Help Portal article Reserves for Bad Debt, subsection Writing Off a Receivable.

SAP Business ByDesign

You proceed to manually clear the customer invoice as follows:

1. Go to the Receivables work center.
2. Go to the Customer Accounts view.
3. Open the relevant customer account.
4. Select the document to be written off and click Clear Manually.
5. In the New Manual Clearing screen, use S01 - Insolvency as Payment Difference Reason and post the clearing.
6. Although the help article mentions that "The VAT amount is corrected on the basis of your country settings", you can't see any corrective tax postings in the resulting Journal Entry or a subsequent VAT Return Run.

• This functionality has not been implemented in all country versions of SAP Business ByDesign.
• Among others, Canada is currently not supported.

• For countries where this functionality is not yet supported, any tax corrections for insolvency-based write-offs would need to be performed manually according to the country-specific regulations.
• We recommend using a New Journal Entry Voucher to do so.

SAP Help Portal: Reserves for Bad Debt

bad debt; insolvency; VAT; corrective tax posting; writing off , KBA , SRD-FIN-ACR , Receivables , Product Enhancement