Reference

BR-E-05 Exempt invoice line VAT rate must be 0

In an invoice line (BG-25) where the invoiced item VAT category code (BT-151) is "Exempt from VAT" (E), the invoiced item VAT rate (BT-152) shall be 0 (zero).

An exempt supply carries no VAT: a rate above zero contradicts category E and distorts the VAT breakdown. In practice, the error occurs when software keeps the usual rate of the item (for example 19 %) after the line is switched to category E. Exempt allowances and charges are covered by BR-E-06 and BR-E-07.

Solution

Set cac:InvoiceLine/cac:Item/cac:ClassifiedTaxCategory/cbc:Percent (BT-152) to 0 on every line with category E. If VAT is actually due, use category S with the applicable rate instead.

Quick actions

Validate XML Convert invoice

Valid Examples

Line with BT-151 = E and BT-152 = 0

Invalid Examples

Line with BT-151 = E and BT-152 = 19

Code Examples

Valid XML

<cac:InvoiceLine>
  <cac:Item>
    <cac:ClassifiedTaxCategory>
      <cbc:ID>E</cbc:ID>
      <cbc:Percent>0</cbc:Percent>
      <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
    </cac:ClassifiedTaxCategory>
  </cac:Item>
</cac:InvoiceLine>

Invalid XML

<cac:InvoiceLine>
  <cac:Item>
    <cac:ClassifiedTaxCategory>
      <cbc:ID>E</cbc:ID>
      <cbc:Percent>19</cbc:Percent>
      <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
    </cac:ClassifiedTaxCategory>
  </cac:Item>
</cac:InvoiceLine>