Showing service plan prices apart from the car price
What a South African dealer must show separately when it sells a vehicle with a service plan, maintenance plan or other add-on, and how to invoice it.
By Achekam · · 4 min read · For Automotive businesses in South Africa
A buyer agrees a price for a new car and, an hour later in the finance office, signs for a monthly instalment that includes a service plan, a tyre and rim cover, scratch and dent insurance and a tracking device. The deal is done. Months later the buyer looks at the paperwork and cannot tell what the car cost and what the extras cost, or whether any of them were optional.
South Africa's Competition Commission has addressed exactly this bundling in its aftermarket guidelines. Approved dealers are now expected to separate the vehicle from the add-ons at the point of sale, and to tell buyers that the add-ons can be declined or bought elsewhere. This article explains what the guidelines require, and how to set up invoices so the split is visible on the document the buyer receives.
The point-of-sale rule
The Competition Commission's aftermarket guidelines require approved dealers, at the point of sale, to disclose the purchase price of the vehicle separately from the prices of service plans, maintenance plans and other value-added products.
The aim is simple: the buyer should be able to see what the car costs on its own, and what each extra adds. A single figure that blends the vehicle with three or four products does not allow that comparison.
The guidelines were prepared under section 79(1) of the Competition Act and are effective from 27 March 2025. The Commission states that they are not binding on the Commission, the Competition Tribunal or the Competition Appeal Court; they describe the conduct the Commission expects rather than creating legislation. The full text is in the Commission's guidelines for competition in the automotive aftermarket.
Optional, and available elsewhere
The same provision says consumers may decline service plans, maintenance plans and other value-added products, or buy them from any licensed provider at any time. That changes the sales conversation. A plan is something the dealer offers, not something the buyer must take to get the car.
A practical way to make this clear is a short written statement in the deal pack, signed by the buyer, listing each add-on offered, its price, and the fact that it is optional and available from other licensed providers. That statement protects the dealer as much as the buyer if the sale is later questioned.
Commissions and finance providers
The guidelines go further than prices. They require approved dealers, at the point of sale, to disclose dealer commissions and other commissions arising from commercial arrangements with the manufacturer and third parties, to the extent that this is not competitively sensitive information.
They also put a duty on finance providers: to give details of the inclusions and exclusions in maintenance and service plans, including the average price of each service interval. A dealer whose finance office arranges the finance should make sure that information reaches the buyer, because the buyer will associate any gap with the dealership, not the bank.
A related provision deals with what happens later: if the insurer writes the vehicle off, the plan must be transferred to a replacement vehicle or the consumer told of the right to cancel or be refunded the remaining value. That is easier to handle when the plan's price was recorded separately in the first place.
One invoice line per product
The easiest way to show the split is on the invoice itself. In Achekam a business creates customer invoices as drafts it can change or delete, and issuing one takes the next number in its sequence and posts it to the ledger as debtors, sales and output VAT. Build the vehicle sale invoice with one line per item:
| Line | Description |
|---|---|
| 1 | The vehicle: make, model, year, VIN |
| 2 | Service plan or maintenance plan, with its term |
| 3 | Each other value-added product, by name |
| 4 | Any accessories fitted |
The issued invoice can be downloaded as a PDF on the dealer's letterhead and e-mailed from the invoice, and a failed send is reported as not sent. The buyer receives a document that shows the split the guidelines call for.
Enter the dealership's VAT registration number in Settings under Firm Profile. Documents made by the server print it, and are titled Tax Invoice only when a VAT number is set.
Why the revenue still lands in one account
There is a limitation to plan around. In Achekam today, all invoice revenue posts to one account, Professional Services Revenue (4100), even for a business that sells goods, and an invoice line cannot name another sales account. The invoice the buyer sees is split line by line; the ledger is not.
Until that changes, read the split from the invoices rather than from the revenue account. At month end, list the plan and add-on lines from the month's vehicle invoices, total them by product, and post a manual journal moving those amounts from account 4100 to the accounts where you want to see them, such as a separate revenue account or, for a plan you deliver over time, a deferred revenue liability. Achekam refuses a journal that does not balance or that is dated in a closed month, so post it before closing the month.
A checklist for the finance office
- Vehicle price shown separately from every add-on, on the offer and the invoice.
- Each add-on on its own invoice line, with its price.
- A signed statement that add-ons are optional and available from other licensed providers.
- Commissions disclosed as the guidelines require, unless competitively sensitive.
- The finance provider's plan details, including inclusions, exclusions and the average price per service interval, passed to the buyer.
For handling plans after a write-off, see maintenance plans when the insurer writes a car off; for deposits and finance settlements, read deposits and finance house payments.
A buyer who can see what each part of the deal costs is a buyer who is less likely to feel cheated by it later.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
