The appellant law firm appealed a GST/HST assessment that disallowed a claimed bad debt deduction of $37,283.11 for its April 1 to June 30, 2017 reporting period.
The Minister disallowed the deduction on three grounds: insufficient collection efforts, failure to write off the debts in the books of account, and failure to remit all net HST for the periods when the debts were rendered.
The Tax Court of Canada dismissed the appeal, finding that the appellant failed to establish that the debts were bad, failed to write them off in its books of account, and failed to remit the required net tax by the time the deduction was claimed.
