How to record impairment of receivables

What is it for?

At the year-end closing, overdue customer debts may have to be recognised as an impairment loss. The product does two things, without posting anything: the impairment map measures how overdue each debt is and calculates the impairment, and the suggested impairment entry tells you how much to increase (or reverse) compared with what is already recorded. You make the journal entry yourself.

When to use it?

• At the year-end closing (or at the end of a quarter), to decide the increase in customer impairment.
• To know what part of the accounting impairment exceeds the tax limit and has to be added back in Form 22 (Modelo 22).
• Do not use the map as the final decision on collectability: it only measures how overdue a debt is (see the notes below).

Where to find it?

Accounting › Close › Close the month, in Supporting lists:

• Credit impairments opens the map.
• Suggested impairment entry opens the suggestion, which has the Open the impairment map button to go to the map.

Before you start

• Your profile is Accountant (tested with it up to the last step). Management and the Auditor open the map, but in the supporting lists they do not have the Suggested impairment entry.
• Invoices and collections are recorded and paid debts are reconciled: the map starts from the balance outstanding at the date.
• The example is the 2026 closing of Empresa Demonstração, Lda, seen on 03/11/2026: the customer debts and, for this example only, an old debt of €1,000.00 from Padaria Aurora, Lda, due on 31/03/2026 (a balance brought over from another software). The demonstration's invoices all fell due after June 2026: without that debt, 2026 gives an impairment of €0.00, the “Nothing to book” case (see “Common problems”). With your own data, use the end of the fiscal year you are closing.

How to use it

1. Open Accounting › Close › Close the month and, in Supporting lists, Credit impairments. The map opens on the current year. In 2026, the five customers add up to €7,981.73 and the impairment is €250.00. This total equals the Customers line of the 2026 balance sheet.
2. Check the year in the list of years: the map measures how overdue debts are on the last day of that year.
3. Read the columns. Each debt falls into an overdue column (counted from the due date): Not due, Up to 6 months, More than 6 up to 12 months, More than 12 up to 18 months, More than 18 up to 24 months and More than 24 months. Then come the Total, the Tax impairment (tax limit, CIRC 28-B), the Accounting impairment and the Excess over the tax limit (to add back in Form 22). In the example, €6,981.73 are in Up to 6 months, with no impairment, and the old €1,000.00 debt is in More than 6 up to 12 months, with an impairment of €250.00 (25%).
4. Click the triangle to the left of a customer to see the documents. Padaria Aurora, Lda has the old debt, due on 31/03/2026 (€1,000.00, with an impairment of €250.00), and FT D26/28, due on 09/10/2026 (€143.10, with no impairment).
5. In Supporting lists, open Suggested impairment entry. The Reference date defaults to 31 December of the previous year (31/12/2025): with it, everything is at €0.00 and the screen says “Nothing to book: the impairment already booked is the one of the map.”. Click the date and type 31/12/2026.
6. The suggestion updates: Tax impairment €250.00, Accounting impairment €250.00, Accumulated impairment booked €0.00, Debit account 6511 Customers, Credit account 21911 General customers and Amount of the entry €250.00, with the note “Only a suggestion: nothing is posted. Post it yourself if you agree.”.
7. If you agree, post the movement yourself in Accounting › Record › Journal entries: New, journal Miscellaneous Operations, the reference Date, one debit line on 6511 and one credit line on 21911, both with the suggested amount, and Post. If you post before that date, the screen warns: “The date of this entry is in the future. Publishing it books it now, in the period of that date. To have it published by itself on that date, set "Auto-post" to "At date" instead of publishing it.”

Expected result

• A posted journal entry (in the example, OD/2026/00109) with a debit of €250.00 on 6511 Customers and a credit of €250.00 on 21911 General customers. In the 2026 Ledger, 6511 shows €250.00 debit and 21911 shows €250.00 credit, with a balance of -€250.00.
• In the 2026 income statement, the line Impairment of receivables (losses/reversals) becomes -€250.00 and the Net result of the period goes from -€59,331.84 to -€59,581.84. In the 2026 balance sheet, the Customers line goes from €7,981.73 to €7,731.73. Review the result simulation, if you had already done one.
• With the same date, the suggestion changes to Accumulated impairment booked €250.00, Amount of the entry €0.00 and the note “Nothing to book: the impairment already booked is the one of the map.”.

Important notes

• What the map counts. Only outstanding customer debts (with a partner) whose due date is before the date. VAT settlements and the accumulated impairment account itself are not included: after the journal entry, the map keeps the same total.
• The rates. The impairment is 25% if the debt is more than 6 months overdue, 50% 12 months, 75% 18 months and 100% 24 months. In the example, if nothing is collected, the impairment becomes €4,240.87 in 2027 and, in 2028, with everything in More than 24 months, €7,981.73. The accounting impairment comes out the same as the tax one and the excess column stays at €0.00. Pending validation by a certified accountant: tax rates per bracket and deductibility (Corporate Income Tax Code (CIRC), article 28-B), the exclusions of paragraph 3 (the State, receivables covered by insurance or collateral, related parties) and the entity's own accounting rate.
• What the map does not see. It does not know whether the debt is collectable, whether collection steps were taken, or whether the receivable is excluded from the tax limit. That assessment, and the evidence of impairment, are yours. Receivables from an excluded partner cannot be marked on screen.
• Reversing. If the impairment already recorded is greater than the map's, the suggestion is reversed. In the example, with €350.00 recorded, it suggests Debit account 21911, Credit account 6511 and Amount of the entry €100.00, with Reinforce off. The product credits 6511, the loss account, although the chart has a specific account for reversals, 76211 Customers. Pending validation by a certified accountant: whether the reversal is posted to 76211 instead of 6511.
• The map button does not carry the date. Open the impairment map opens the map for the current year, whatever the reference date: choose the year in the list.
• Reversing with a future date. The reversal of a journal entry with a future date stays in draft, to be posted on that date (“This move is configured to be posted automatically on 31/12/2026”). The accumulated impairment only changes when the reversal is posted. See reverse a journal entry.

Common problems

“Nothing to book: the impairment already booked is the one of the map.”

• Cause: the reference date is in a year with no debts more than 6 months overdue (31/12/2025, in the example; without the old debt, also 31/12/2026), or the impairment is already recorded.
• What to do: check the Reference date (the end of the fiscal year) and whether you have already made the journal entry. Amounts at €0.00 with the accounts blank are expected.

I cannot find “Suggested impairment entry”

• Cause: your profile is Management or Auditor, which only see the map.
• What to do: ask an Accountant or Fiscal officer to open it and post it.