CCLG13350 - Bad Debt Relief on CCL: Claiming the relief and repaying bad debt relief after receiving payments from customers

If an energy supplier claims a credit for bad debt relief and subsequently receives any payment from that customer, the appropriate amount of credit must be repaid. These requirements are in regulation 17 of the CCL (General) Regulations 2001. For part payments received, the rules on apportionment/attribution mentioned in paragraph CCLG13250 above, apply.

17 (1) Where a supplier

(a) has received the benefit from a tax credit provided by regulation 10 (bad debts) and

(b) a payment -

(i) for the taxable supply in question is subsequently received by him (or by a person to whom has been assigned a right to receive the whole or any part of the price written off), or

(ii) is attributed to that supply by virtue of regulation 16,

that tax credit shall be withdrawn with effect from when sub- paragraph(b)(i) or (b)(ii) is satisfied as the case requires.

Bad debt relief claims and payments from debtors for bad debt relief already claimed should be accounted for as adjustments in the accounting period where the bad debt relief claim is made or payment from the debtor is received. This may be done by adjusting the amount of CCL declared for payment in boxes 1 - 4 of the CCL return, CCL100. Where payments from debtors are not adjusted in the accounting period when they are received they should be included in the total of under declaration errors.