GmbH Bad Debt Write-Offs in Germany 2026: How to Book Uncollectible Receivables

Book an uncollectible receivable at its gross amount to bad debt losses: SKR03 2406 to 1400, SKR04 6936 to 1200. Correct the VAT in it under § 17 (2) No. 1 UStG in the VAT return for the month in which the loss becomes certain. This applies to every GmbH and UG that pays VAT on invoiced amounts (Soll-Versteuerung).

Key takeaways

• Write-off at gross: SKR03 2406 to 1400, SKR04 6936 to 1200. Both are DATEV automatic accounts with 19% VAT. The same entry corrects the VAT; you post no second VAT entry.
• When to correct the VAT: in the return period in which the receivable becomes uncollectible (§ 17 (1) sentence 8 UStG), never back in the month of the invoice.
• Latest point in an insolvency: the opening of insolvency proceedings against the customer. From then on the whole receivable counts as uncollectible, even if a dividend follows later.
• Loss only likely: a specific allowance at the balance sheet date on the net amount (SKR03 2451 to 0998, SKR04 6923 to 1246), with no VAT correction.
• Cash-basis VAT under § 20 UStG (prior-year turnover up to €800,000): VAT arises only on payment, so there is nothing to correct.
• Limitation: receivables from 2023 become time-barred after 31 December 2026. A court payment order served before then suspends the period.

When a receivable is uncollectible

A receivable is uncollectible when, viewed objectively, you cannot enforce it legally or in fact for the foreseeable future. That is the Federal Fiscal Court's test. The law sets no number of days. An invoice that is merely paid late does not qualify.

In the last row the loss is likely but not certain. The next step is a court payment order. How to remind customers before that is covered in our guide to payment reminders in Germany.

When an open invoice becomes unusual: data from Norman

How long an invoice normally stays open shows in our analysis of real incoming payments to self-employed people and small businesses, invoice dates January 2024 to June 2026 (invoice payment times in Germany):

• The median invoice is paid 8 days after the invoice date. After 30 days 89% are paid, after 60 days 98%.
• 21% are paid after the due date, almost half of those within the first week. Only 2.4% arrive more than 30 days late.
• Late payment hits almost everyone: six in ten businesses had at least one late invoice, more than one in four had one that was over two weeks overdue.

Download CSV

For your books this means: an invoice still open 30 days after the due date is one of the rare outliers. A business customer is in default by then at the latest (§ 286(3) BGB). The receivable is not yet uncollectible, and the VAT stays as it is. Now is the time for the final notice and a court payment order. If the invoice is still open on the balance sheet date, check a specific bad debt allowance.

The limit of the data: we only count invoices whose payment reached the bank account. How many invoices are never paid, the analysis does not show.

Doubtful or uncollectible: the difference

SKR03 and SKR04 entries step by step

The examples assume 19% VAT. At 7%, use SKR03 2401 or SKR04 6931 for the write-off.

If you skipped step 1, book step 3 directly against 1400 or 1200. Step 4 only applies when an allowance from a prior year exists. If you keep customer accounts, book the customer's account instead of the control account.

A common mistake: posting to 2406 or 6936 and then also posting 1776 to 2406. That corrects the VAT twice, because the automatic account already takes the VAT out.

The other differences between the two charts are in our guide to SKR03 and SKR04 for a GmbH.

Worked example: €11,900 lost in an insolvency

In March 2026 your GmbH invoiced €10,000 net plus €1,900 VAT. On 14 October 2026 insolvency proceedings are opened against the customer.

In the VAT return for October 2026 you enter minus €10,000 in box 81. The VAT falls by €1,900. Monthly filers submit that return by 10 November 2026.

The €10,000 expense also lowers income taxes. With 15% corporate income tax, the 5.5% solidarity surcharge on it and a trade tax multiplier of 400%, the rate is 29.825%. The GmbH pays about €2,983 less income tax, so the real loss is about €7,017.

If money comes in after all: the insolvency dividend

If the administrator later pays a dividend, you correct the VAT again (§ 17 (2) No. 1 sentence 2 UStG). A 5% dividend on €11,900 brings in €595: €500 consideration and €95 VAT.

The €95 goes into the VAT return for the month in which the dividend reaches your account.

Deadlines in 2026 and 2027

The payment order suspends the limitation period until six months after the proceedings end (§ 204 (2) BGB). Check your open invoices from 2023 in November.

What a mistake costs

• Correction forgotten: you pay the €1,900 VAT from the example although no money came in. If you missed the right month, file a corrected return for that month.
• Corrected too early: a customer who only pays late does not make the receivable uncollectible. In an audit, the tax office claims the VAT for that period back.
• Corrected retroactively: correcting in the month of the invoice is wrong. The correction belongs to the month in which the loss becomes certain.
• Corrected twice: a write-off on the automatic account plus a separate VAT entry reduces the VAT twice.
• Limitation missed: you can no longer enforce a time-barred receivable, even if the customer could pay again.

How to do this with Norman

1. Send the invoice with a reminder rule. Under "Remind if unpaid" you set when Norman reminds your customer. The default is a payment reminder, a first dunning notice and a final notice 3, 14 and 28 days after the due date. That fits our data: almost half of late payments arrive in the first week after the due date. Automatic reminders are part of the paid plans, for companies from Pro.
2. Check before each send. If the bank connection cannot confirm that the invoice is still open, Norman asks you: "Already paid" or "Don't send". Without an answer, the reminder goes out.
3. Decide on the loss. Whether a receivable is uncollectible is your decision, based on the trigger table above. Keep the evidence.
4. Record the write-off. In your GmbH journal, choose "+ Manual entry", enter the debit account, credit account and amount, assign the tax treatment and attach the evidence as a document.
5. Check and send the VAT return. Before you send, check that box 81 falls by the net amount in the month of the loss. You send the VAT return from Norman on the Max plan.

The limit: Norman does not book the bad debt or the § 17 UStG correction on its own. You decide on the loss and post the entry in the journal. What Norman handles for a GmbH's bookkeeping and taxes is on the product page.

Read on: cash vs. accrual VAT, the German VAT return, accounts receivable automation and provisions in a GmbH.