Reference

BR-AE-10 Reverse charge VAT breakdown needs the exemption reason "Reverse charge"

A VAT breakdown (BG-23) with VAT category code (BT-118) "Reverse charge" (AE) shall have a VAT exemption reason code (BT-121) meaning "Reverse charge" (VATEX-EU-AE) or the VAT exemption reason text (BT-120) "Reverse charge" (or the equivalent standard text in another language).

Problem Description

ERROR

EN 16931 VAT category rule

Context and Significance

The VAT Directive (Article 226, point 11a) requires the mention "Reverse charge" when the buyer is liable for the VAT. Without it, the buyer cannot see from the structured data that they must account for the VAT themselves. In practice, the mention is often printed on the PDF but not written into BT-120 or BT-121.

Solution

Add cbc:TaxExemptionReasonCode = VATEX-EU-AE and/or cbc:TaxExemptionReason = "Reverse charge" to the cac:TaxCategory of the AE breakdown (cac:TaxTotal/cac:TaxSubtotal). The validator only checks that a code or text is present; BR-CL-22 checks that the code exists in the VATEX list.

Quick actions

Validate XML Convert invoice

Valid Examples

AE breakdown with BT-121 = VATEX-EU-AE
AE breakdown with BT-120 = "Reverse charge"

Invalid Examples

AE breakdown with neither BT-120 nor BT-121

Code Examples

Valid XML

<cac:TaxCategory>
  <cbc:ID>AE</cbc:ID>
  <cbc:Percent>0</cbc:Percent>
  <cbc:TaxExemptionReasonCode>VATEX-EU-AE</cbc:TaxExemptionReasonCode>
  <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>

Invalid XML

<cac:TaxCategory>
  <cbc:ID>AE</cbc:ID>
  <cbc:Percent>0</cbc:Percent>
  <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>

Affected Fields

BT-118 VAT category code

BT-120 VAT exemption reason text

BT-121 VAT exemption reason code

Validation Tools

Official KoSIT Validator

Run the official KoSIT validator with the XRechnung configuration to check EN 16931 and XRechnung rules.

Convert PDF to XRechnung

Find validation errors during conversion and review each correction.