Cabinet Decision No. 39 of 2019, Article 12, establishes strict criteria for deducting bad debts. For a debt to be deductible, it must have been included in taxable income previously, be at least 24 months overdue, and the taxpayer must prove that collection was impossible despite legal efforts. An auditor's certificate confirming the write-off and an approved form attached to the tax return are required. If a bad debt is later recovered, it must be reported as income in the year of collection, ensuring accurate long-term financial reporting.