Regulation 16 Bad debts: supplementary provisionsI1
United Kingdom
Where—
a claimant in relation to regulation 10 has made a taxable supply,
there exist one or more other matters in respect of which the claimant is entitled to a debt owed by the recipient (whether or not they involve a taxable supply), and
a payment has been received by the claimant from or on behalf of the recipient,
the payment shall be attributed to the taxable supply and the other matters in accordance with the rules set out in paragraphs (3) and (5).
The debts arising in respect of the taxable supply and the other matters are collectively referred to as debts in paragraphs (3) to (5).
The payment shall be attributed to the debt that arose earliest and, if not wholly attributable to that debt, to the other debts in the order of the dates on which they arose.
Attribution under paragraph (3) shall not be made to the extent that the payment was allocated to a debt by the recipient (customer) at the time of payment.
Where—
the earliest debt and the other debts to which the whole of the payment could be attributed arose on the same day, or
the debts to which the balance of the payment could be attributed in accordance with paragraph (3) arose on the same day,
the payment shall be attributed to each remaining debt according to the proportion that the debt in question contributes to the total remaining debt.
Annotations
Commencement
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Reg. 16 in force at 1.4.2001, see reg. 1