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Write off a bad debt and claim VAT bad debt relief

Quick answerIn MAJA Books go to Sales → Bad Debt Relief → New Bad Debt Relief (or open the invoice and choose Record Payment ▾ → Write Off), pick the customer and outstanding invoice, enter the amount, approver and reason, and click Post Write-Off — MAJA writes off the receivable and, when the FTA conditions are met, reclaims the output VAT.
Where: MAJA Books → Sales → Bad Debt Relief → New Bad Debt ReliefWho: Any user whose role allows recording payments received (bad debt is part of it)

Before you start

  • Apply any money the customer has on deposit to the invoice first. MAJA refuses the write-off while the customer has unapplied money in Customer Deposits.

Steps

  1. Open MAJA Books and click Sales in the left menu, then Bad Debt Relief.
  2. Click New Bad Debt Relief. (From an invoice: click the arrow beside Record Payment and choose Write Off — the invoice is filled in for you.)
  3. Choose the Customer *, then the invoice in Invoice (outstanding only) *. MAJA shows the original amount, what was paid and what is outstanding.
  4. Set the Bad Debt Date *.
  5. Check Amount to Write Off * (the outstanding balance is filled in) and the Salesman.
  6. Review the UAE FTA — VAT Relief Eligibility box: - Invoice aged ≥ 6 months is checked from the dates. - Output VAT was declared on a filed return is ticked by MAJA when the invoice's period is in a filed VAT return. - Tick Customer notified of the write-off (where required) if you have notified them.
  7. Enter Approved By * and choose a Reason *.
  8. Optionally add Notes and drop evidence under Attachments.
  9. Click Post Write-Off.

What MAJA does for you

  • When all conditions hold, the box reads VAT Relief allowed — Output VAT will be reclaimed and MAJA splits the amount at the invoice's own VAT ratio: Dr Bad Debt Expense (net) + Dr Output VAT / Cr Accounts Receivable.
  • When they do not, it reads VAT Relief NOT allowed and the full amount goes to Bad Debt Expense.
  • The original invoice is never changed except its balance and status; it stays in the audit trail.

Good to know

  • The amount cannot be more than the invoice's outstanding balance.
  • If the company was not VAT-registered on the invoice date, there is no VAT to reclaim and the whole amount is expense.
  • If the customer later pays some of it, record it with Bad Debt Recovery — not as an ordinary receipt.
  • To correct a write-off, open it and click Edit; MAJA reverses and re-posts it with the same number. Once a recovery has been posted against it, the write-off can no longer be edited or deleted.

Related guides

Record money recovered on a written-off debtVoid or delete an invoiceApply a credit note or advance to an invoice
People also ask
  • How do I write off a bad debt in MAJA Books?
  • How do I claim VAT bad debt relief in MAJA?
  • When can I reclaim VAT on an unpaid invoice in MAJA Books?
  • How do I write off an invoice the customer will never pay in MAJA?
Still stuck? In the app, tap the ? button at the top and choose Chat with MAJA support — the screen you are on goes with your message and the reply comes to the same place (within one working day). Or write to support@majabooks.com, or ask MAJA's assistant (the round button at the bottom right of MAJA Books).