Indeed, the solution sounded rather unrealistic to me, at least by Polish standards. Knowing the entrepreneurial spirit of my compatriots I imagine that thanks to the flood of frivolous claims they would generate, an unrestricted freedom to write off bad debts would very quickly bring the effective income tax rate down to zero.

Originally written by Laurent J Krauland on November 7, 2009 9:40 AM   This means the legally confirmed liquidation of the debtor... and this kind of procedure can be rather long (5 years being a good average).

It could be different in Germany. If you don't get your money within 3 years (at 31st December) the debt has verjährt here anyway.

That would possibly count as "no possibility of recovering the money".

We don't appear to have any Indian members to tell us what the conditions are in India (but I could make an inspired guess!).

Derek

Originally written by Jacek K. on November 7, 2009 10:08 AM Indeed, the solution sounded rather unrealistic to me, at least by Polish standards.... an unrestricted freedom to write off bad debts would very quickly bring the effective income tax rate down to zero.

I wasn't suggesting that it would be totally unrestricted - it would have to be a genuine bad debt. And I wasn't suggesting that the claim would be successful. It could however at least serve the same purpose as Louise's initial posting - letting off a little steam!

What are we left with then? Our unshakeable faith in the basic decency and honesty of translation agencies in general? I am reminded of an occasion on which I asked a German shoe salesman why they put only the right shoes on display and then had to go back to the storeroom to get the left shoe in order to make a sale. He said that if they put both shoes out then they might as well give them away.

I have had two non-payers. One was a very large German company. The amount was over DM 40,000 and the debt had long since verjährt. The IHK of the town in which they were located asked me if I was still getting work from that company and I told them that I was. They told me about the possibility known as "Anrechnung". My debt, although I could no longer pursue it in the courts, remained "anrechnungsfähig" for 30 years. All I had to do was to wait until they paid me for a new job and then tell them that I was applying their payment to the old job, they still owed me for the new one. It worked!

Another non-payer was a Spanish translation agency. I kept sending them e-mails at monthly intervals for about 6 months with no response. I then told them that I was handing the matter over to a (notorious) Spanish debt-collection agency and that did the trick!

 Derek

Originally written by Derek Thornton on November 7, 2009 11:14 AM It could be different in Germany. If you don't get your money within 3 years (at 31st December) the debt has verjährt here anyway. That would possibly count as "no possibility of recovering the money". We don't appear to have any Indian members to tell us what the conditions are in India (but I could make an inspired guess!).

As all Indians are still busy, let me tell you that in Poland, amazingly, you can only write off a non-recoverable claim before the lapse of two years. I haven't studied the relevant regulations myself, but was told, with respect to a certain type of intellectual services (not specifically translation), that six months of documented failed attempts to recover your money may already be a good moment to start looking into writing it off, always provided that economically it makes no sense for you to go to court or to sell your debt. After two years have passed, though, it is too late to do anything about your loss from the accounting point of view.