Invoice Part Payments

          This is a classical error I’ve seeing made in the past.

          Some suppliers have an uncanny way of making reference to advance payments on an invoice inconspicuous and hard to find. One would typically read that the total value on the invoice resembles a 30% advance payment found at the lower end of the invoice in very fine print.

          In such an example the balance of the payment would be followed up with a supplementary invoice for say 70% of the payment. If this is overlooked it will result into an under payment in Customs duties and taxes. Any Customs clearance must reflect the full transaction value of the goods, i.e. inclusive of all part payments per shipment.

          My advice is that payment terms which have being split into two or three lots must be clearly specified and defined on one invoice. If they are split over more than one invoice then this must be clearly indicated.

          I further advise that the sum of all part payments on the invoice must be reflected on the bottom line.

          At the other end of the spectrum I’ve seeing invoices which cover numerous shipments in one transaction. There is nothing wrong with this so long as the quantities and values on the invoice can be apportioned per shipment. Such instances must be backed up with a packing list per shipment.

          Staged Consignments, i.e. large plant or machinery shipped over several consignments should be invoiced appropriately. More about Staged Consignments will be covered in another blog.

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Blank Invoices

          The penal provisions for importing or producing blank invoices going forward will be much different to the past.

          About 18 years ago I was participating in practical Customs training for passenger baggage searches. The training was based at JIA (Johannesburg International Airport), now ORTIA (OR Tambo International Airport).

          My training partner and I were being monitored by the instructor when opening passenger baggage one morning. My partner came across an original BOL (Bill of Lading) in one gentleman’s baggage. Because I was based at a coastal region I was familiar with reading BOL. As a result, we uncovered several containers of fake goods at a nearby premises. In addition, we found a booklet of blank invoices.

          It is illegal to import or to produce blank invoices which are capable of being completed. Blank or incomplete invoices are seeing to be utilised for fraudulent activities.

          At JIA that morning, we proceeded to issue a penalty of R 100 for every page of blank invoice found. There were 38 pages in total. The blank invoices were seized and later destroyed.

          There is a lot more to this story, but you get the point.

          The penal provisions for importing or producing blank invoices is a Category 1 offence in terms of the Customs Control Act.

          In particular, the new penal provisions are imprisonment or a fine not exceeding R 1 million. The new legislation also provides for an ‘additional’ penalty not exceeding three times the monetary benefit gained or to be gained from using them.

          Would you believe, the gentleman who we had penalised at JIA that morning attempted to bribe another Customs Officer to get the blank pages back. This all after being penalised R 3,800 and with several containers being seized. This was a lot of money 18 years ago.

          The penalties going forward appear to be more in line with the level of criminal activity, if engaged in.