Customer Loss and Write-off (1511)

The worst moment as a restaurant owner: the customer doesn't pay. You've invoiced, sent reminders, maybe even sent it to the Swedish Enforcement Agency – but the money never arrives. Now you need to write off the receivable in your books, otherwise it stays and skews your balance sheet forever.

Account 1511 – Doubtful customer receivables / Customer losses

The BAS chart of accounts has several accounts for this:

• 1511 – Write-down of customer receivables (main account)
• 1518 – Doubtful customer receivables (reservation before definitive loss)
• 6350 – Losses on customer receivables (the expense in the income statement)

Terminology varies between accountants and BAS versions. The important thing is the function: when a receivable won't be paid, it's moved from the asset side to the result side – from being a receivable to being a loss.

When should you write off?

Skatteverket has clear rules for when a receivable may be written off (and the deduction approved):

1. Confirmed loss: Customer is in bankruptcy, or the Enforcement Agency has reported that collection is impossible
2. Collection attempts failed: You've demonstrably tried to collect (reminders, debt collection) without result
3. Customer has ceased operations: The company is deregistered from the Companies Registration Office
4. Receivable more than 1 year old without customer contact (practical rule)

Difference: doubtful vs confirmed loss

How a confirmed loss is booked:

Assume you have a receivable of 1,000 SEK (incl 250 SEK VAT) on a restaurant that went bankrupt:

Step 1: Write-down of receivable

Account  Name                         Debit    Credit
──────────────────────────────────────────────────────
6350     Losses on receivables         800
2610     Output VAT 25%                 200     (reversed)
1510     Accounts Receivable                    1000
──────────────────────────────────────────────────────
                                     1000    1000

What happens here?

• 1510 disappears (receivable is closed)
• 6350 debited 800 (you book the loss as a cost)
• 2610 debited 200 (you reverse the VAT since the transaction never went through)

Note the VAT handling: You've already reported 200 SEK in output VAT to Skatteverket. When the receivable is written off, you can claim back the VAT – either by adjusting the next VAT declaration or via a correction.

Step 2: Documentation

You must be able to prove the receivable is a confirmed loss. Keep:

• Bankruptcy decision (from Bolagsverket)
• Enforcement Agency notice of seizure attempt
• Debt collection decision
• Copies of all reminders you've sent

Without documentation, Skatteverket can reject the deduction during an audit.

Doubtful receivable (reservation):

If you suspect a receivable may be lost but aren't sure (e.g. customer stopped responding after 60 days):

Reserve as doubtful:

Account  Name                         Debit    Credit
──────────────────────────────────────────────────────
1518     Doubtful receivables         1000
1510     Accounts Receivable                    1000
──────────────────────────────────────────────────────
                                     1000    1000

Important: No cost is booked yet, just a transfer between two receivable accounts. You do this to signal in the balance sheet that the receivable is doubtful.

If it then becomes a confirmed loss:

Account  Name                         Debit    Credit
──────────────────────────────────────────────────────
6350     Losses on receivables        800
2610     Output VAT 25%                200
1518     Doubtful receivables                   1000
──────────────────────────────────────────────────────
                                     1000    1000

If it's surprisingly paid later:

Account  Name                         Debit    Credit
──────────────────────────────────────────────────────
1580     Bank                         1000
1518     Doubtful receivables                   1000
──────────────────────────────────────────────────────
                                     1000    1000

Example – Harbor Restaurant in Lysekil:

Kenneth runs a restaurant. One of his business customers, the consulting firm "Konsulten Väst AB", goes bankrupt with an unpaid invoice of 8,500 SEK (excl VAT 6,800 + VAT 1,700).

He books the write-off like this:

Account  Name                         Debit    Credit
──────────────────────────────────────────────────────
6350     Losses on receivables        6800
2610     Output VAT 25%                1700
1510     Accounts Receivable                    8500
──────────────────────────────────────────────────────
                                     8500    8500

Effect on result: −6,800 SEK (loss hits the month's result) Effect on VAT: +1,700 SEK (can be deducted on next VAT declaration) Effect on balance sheet: Receivables decrease by 8,500 SEK

Skatteverket: Kenneth saves the bankruptcy decision + all reminders as proof. At the next audit he can show them and get the deduction approved.

Prevention: How to avoid customer losses

1. Credit check before invoicing – use Creditsafe, UC or Bisnode for new business customers
2. Set credit limit on customer card – 20,000 SEK for new customers, upgrade after 6 months
3. Shorter payment terms for risk customers – 15 days instead of 30
4. Stop-flag on unpaid invoices – block the customer from new invoices until old ones are paid
5. Weekly rolling follow-up – 10 minute check every Monday
6. Partial payment on large orders – 50% upfront, 50% on delivery

Practice: customer losses in the restaurant industry

Industry average for customer losses in restaurants:

• À la carte without B2B: 0% (everyone pays cash/card directly)
• Bistro with conference groups: 0.5-1% of B2B turnover
• Fine dining with business customers: 1-2%
• Large catering/events: 2-4% (higher risk on occasional large orders)

If your customer losses exceed 3%, you have a systemic problem in credit assessment or follow-up.

Reporting to Skatteverket:

Customer losses are reported:

• In the annual report as "Other external costs"
• In the VAT declaration as correction (reduced output VAT)
• To the accounting firm as a note in the closing if significant

Read more: Invoicing in Vendion – How It Works, Accounts Receivable (1510) – Booking Invoiced Orders, Paid Invoice – Cash Flow Handling.