What this report shows
The Profit and Loss is your income statement: what the business earned, what it cost to earn it, and what is left. It is laid out the way an accountant reads one — revenue, cost of sales, gross profit, operating expenses, operating profit, any profit or loss on selling assets, finance costs, and then the headline, Profit before tax. Below that it shows any of the business's own tax you paid on account and the profit after that.
Every line is one of your SARS categories, grouped under its heading — Employee costs, Premises, Motor vehicle and so on — so the report reads the same way your annual return does. It pulls together your invoices, supplier invoices, credit notes, the cash you logged in and out, and your asset register. You do not enter anything here.
- Every figure is without VAT. VAT is SARS's money passing through, never income or a cost.
- It counts invoices from the day you issue them and supplier invoices from the day they are issued, not when the cash moves. That is the accrual basis, and it is the only basis this report uses.
- It is always the whole business. To look at one bank account, use Cash Flow or Money Reports — a Profit and Loss is a statement of the business, not of an account.
Open the report and pick a period
- Open Profit and Loss, under the "Financials" tools card (or the "Financials" group on desktop).
- Tap the period chip: This month, Last month, Tax year to date, Last tax year or Custom dates, and under Compare with, Last year (the default), Period before or Nothing — a second column, where your books reach that far. It opens on Tax year to date. Last tax year is the window your annual return starts from.
- Read the three tiles at the top: Revenue, Gross profit with its margin, and Before tax — profit before tax — each with how it moved against the comparison.
- Detailed shows every SARS category on its account number; Summary shows each heading on one line. Every line has the accountant's term; tap a line to see the entries behind it in the General Ledger, for the same dates.
Reading the statement
- Revenue: what you earned from your trade. Other income and Grants & funding sit below gross profit, as a statement lays them out, so your gross profit and margin are your trade's alone. Money you received that is not revenue — a loan, your own capital, a dividend, what a business asset sold for — is kept out: it is not income, so it is not on this statement.
- Cost of sales and Gross profit: materials, stock and subcontract labour come off first, and what is left is your gross profit with its margin.
- Operating expenses: every other heading, each with its lines. Small assets written off in full sit under Assets; anything over R7 000 that is not in your asset register yet is flagged there. Depreciation is the register's write-off for the period and says how many assets it comes from.
- Operating profit, then Selling things you own if selling an asset made a profit or a loss, then Finance costs (interest on borrowings), then Profit before tax — the headline. Only the interest is a cost: paying back the loan itself lowers what you owe.
- Taxation: your own income tax, provisional tax or Turnover Tax paid on account in the period, less any income tax SARS paid back to you, and then Profit after tax. This is the one cost that comes off the tax bill rather than off the profit, which is why it sits below the line. A refund lowers it, and the tax screens take the refund back out, because tax paid back is not income.
Change in stock: if you count your stock (Stock & Assets → Stock count), Cost of sales gets a 5090 Change in inventory line. It compares your last count in the period with your last count before the period began. Nothing counted before your books started is growth: a period that reaches back past your start date (the tax year to date, when your books started part-way through it) is measured from the stock you started your books with in Opening Balances, as the Balance Sheet is. Nothing dated before your start date counts here at all — stock you bought, a sale, a cost — as on your Trial Balance: the stock you started with is the day-one figure in Opening Balances. Stock that grew comes off your costs and stock that shrank is added, so you're charged for what you used. A count with no count before the period (and no day-one stock saved) has nothing to compare with, so all of it comes off. A period with no count in it has no Change in stock line. Your opening stock is set in Opening Balances. Tap the line to see the counts it was worked out from. A count can't be edited: Recount opens Stock Count's Counts tab, where you tap Replace on it, count again and say why. When it is your first count and no day-one stock is saved, Add your day-one stock (Opening Balances, step 3) — then only what changed since your books started comes off. The statement shows the working: stock at the start, plus materials and stock bought, less stock still on the shelf.
Selling things you own: if selling, scrapping or losing an asset in the period left a profit or a loss in your books, a line of its own sits between Operating profit and Finance costs. Something already written off in full and scrapped for nothing leaves neither, so it adds no line. Profit on selling assets has a plus and adds to your profit; Loss on selling assets has a minus and takes away. It is what your assets fetched against what was left of them in your books, for everything that went in the period. What the buyer paid is never revenue.
Money with no SARS category set lands on 4900 Income with no category or 6990 Expenses with no category, with an amber note. It is never dropped — the totals still add up — but it is filed under nothing. Tap the line to see each entry behind it. A bank line has a category picker right there — pick one and it leaves the list. A saved invoice, supplier invoice or credit note shows Set its lines' categories: each line gets a picker with the categories it may move between. Only the category changes — never the words, amounts or VAT — and the change is kept in your Audit Log. A line under a category VAT or tax treats differently (a loan, an asset, entertainment, tax paid) stays as it is — that takes a credit note — and so does anything dated inside a VAT201 or annual return marked filed. A credit note's copies of a line move with it, so they can't be re-filed on their own. A bank line split into parts can't be re-filed here yet; it says so and opens to show you the record.
Why your tax figure is different
Profit before tax is what the business made. What SARS taxes is worked out from it: the annual return adds back costs the Act does not allow, takes back allowances on anything you sold, and sets off any loss carried forward. Set this report to the tax year and the profit here is the figure that return starts from.
Save or send it
At the bottom, 📄 PDF gives you the statement to hand to your accountant, and 📊 CSV / Excel the same figures as a spreadsheet. On a phone, each opens your share menu with the file attached; on a computer it downloads.