# BR-AF-10 IGIC breakdown must not carry an exemption reason

A VAT breakdown (BG-23) with VAT category code (BT-118) "IGIC" shall not have a VAT exemption reason code (BT-121) or VAT exemption reason text (BT-120).

## Problem Description

A VAT breakdown (BG-23) with VAT category code (BT-118) "IGIC" shall not have a VAT exemption reason code (BT-121) or VAT exemption reason text (BT-120).

> **ERROR**: XRechnung 3.0

## Context and Significance

The IGIC category (the Canary Islands indirect tax) comes from the updated EN16931 code lists supported by the current XRechnung 3.0.2 rulepack and is a taxable category, so an exemption reason would contradict it; exemption reasons belong to categories E, K, G, O or AE.

## Solution

Remove cbc:TaxExemptionReasonCode (BT-121) and cbc:TaxExemptionReason (BT-120) from the "L" (IGIC) cac:TaxSubtotal/cac:TaxCategory; IGIC is a taxed category, not an exemption.

- validate
- convert

## Valid Examples

- BG-23 group with BT-118 = "L" (IGIC), rate 7.00 %, and no BT-120 or BT-121

## Invalid Examples

- BG-23 group with BT-118 = "L" (IGIC) that also carries BT-121 = "VATEX-EU-IC"

## Code Examples

### Valid XML
```
<cac:TaxSubtotal>
  <cac:TaxCategory>
    <cbc:ID>L</cbc:ID>
    <cbc:Percent>7.00</cbc:Percent>
    <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
  </cac:TaxCategory>
</cac:TaxSubtotal>
```

### Invalid XML
```
<cac:TaxSubtotal>
  <cac:TaxCategory>
    <cbc:ID>L</cbc:ID>
    <cbc:Percent>7.00</cbc:Percent>
    <cbc:TaxExemptionReasonCode>VATEX-EU-IC</cbc:TaxExemptionReasonCode>
    <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
  </cac:TaxCategory>
</cac:TaxSubtotal>
```

## Affected Fields

- [BT-118 VAT category code](/resources/xrechnung/bt-118-vat-category-code)
- [BT-120 VAT exemption reason text](/resources/xrechnung/bt-120-vat-exemption-reason-text)
- [BT-121 VAT exemption reason code](/resources/xrechnung/bt-121-vat-exemption-reason-code)

## Related Rules

- [BR-AF-01](/resources/kosit-validator-errors/br-af-01-igic-vat-breakdown-required)
- [BR-CL-22](/resources/kosit-validator-errors/br-cl-22-vatex-tax-exemption-reason)

## Validation Tools

- [Official KoSIT Validator](https://erechnungsvalidator.service-bw.de/): Validate your XRechnung files against all BR-DE rules.
- [Convert PDF to XRechnung](/pdf-to-xrechnung): Automatic validation error fixes when converting.

## Related Resources

- [Official Specification](https://xeinkauf.de/xrechnung/)
- [Test Suite](https://github.com/itplr-kosit/xrechnung-testsuite)
- [Complete Error List](/resources/kosit-validator-errors): Overview of all German XRechnung validation rules.