Financial
Can I write off Bad Debts in Canada?
YES
Explanation
You can deduct a bad debt if you have already included that amount in your income (Accrual basis) and you have determined it is uncollectible. If you use the Cash method of accounting, you cannot deduct bad debts because you never claimed the income in the first place.
💡 Pro Tip
Document your attempts to collect the debt (emails, letters) before writing it off. This proves to the CRA that the debt is genuinely bad.