# BR-CL-22 Tax exemption reason code must come from CEF VATEX

The VAT exemption reason code (BT-121) must belong to the CEF VATEX code list.

## Problem Description

> **ERROR**: EN 16931 code-list rule (BR-CL)

## Context and Significance

BT-121 gives the reason for a VAT exemption as a code, so that the buyer can post the invoice without reading free text. The rule fails when a legal reference such as "Art. 138 Directive 2006/112/EC" or an internal code such as "EXEMPT" is written in the code field, or when the value contains spaces. Upper and lower case do not matter for this check. Example: an intra-community supply of goods uses category K with BT-121 = VATEX-EU-IC and the legal basis as text in BT-120.

## Solution

Set BT-121 to a VATEX code that matches the VAT category, e.g. VATEX-EU-AE (reverse charge, category AE), VATEX-EU-IC (intra-community supply, K), VATEX-EU-G (export outside the EU, G) or VATEX-EU-O (not subject to VAT, O). Put the legal reference as text in BT-120. In UBL, the code is cac:TaxCategory/cbc:TaxExemptionReasonCode; in CII, ram:ApplicableTradeTax/ram:ExemptionReasonCode.

- [Validate XML](/en/xrechnung-validator?source=resource&rule=BR-CL-22)
- [Convert invoice](/en/pdf-to-xrechnung?source=resource&rule=BR-CL-22)

## Valid Examples

- BT-121 = VATEX-EU-IC — intra-community supply (category K)
- BT-121 = VATEX-EU-G — export outside the EU (category G)

## Invalid Examples

- BT-121 = Art. 138 Directive 2006/112/EC — legal reference; it belongs in BT-120
- BT-121 = EXEMPT — internal code

## Code Examples

### Valid XML
```
<cac:TaxCategory>
  <cbc:ID>K</cbc:ID>
  <cbc:TaxExemptionReasonCode>VATEX-EU-IC</cbc:TaxExemptionReasonCode>
  <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>
```

### Invalid XML
```
<cac:TaxCategory>
  <cbc:ID>K</cbc:ID>
  <cbc:TaxExemptionReasonCode>EXEMPT</cbc:TaxExemptionReasonCode>
  <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>
```

## Affected Fields

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

## Related Rules

- [BR-CL-17](/resources/kosit-validator-errors/br-cl-17-uncl5305-document-tax-category)
- [BR-E-01](/resources/kosit-validator-errors/br-e-01-exempt-vat-breakdown-required)
- [BR-AE-02](/resources/kosit-validator-errors/br-ae-02-reverse-charge-seller-vat-id-required)

## Validation Tools

- [Official KoSIT Validator](https://github.com/itplr-kosit/validator): Run the official KoSIT validator with the XRechnung configuration to check EN 16931 and XRechnung rules.
- [Convert PDF to XRechnung](/pdf-to-xrechnung): Find validation errors during conversion and review each correction.

## Related Resources

- [Official Specification](https://docs.peppol.eu/poacc/billing/3.0/rules/ubl-tc434/)
- [Test Suite](https://github.com/itplr-kosit/xrechnung-testsuite)
- [All validation errors](/resources/kosit-validator-errors): Overview of the EN 16931, XRechnung and Peppol validation rules explained here.