Reference

BR-E-09 Exempt VAT category tax amount must be zero

The VAT category tax amount (BT-117) in a VAT breakdown (BG-23) where the VAT category code (BT-118) equals "Exempt from VAT" (E) shall equal 0 (zero).

An exempt supply produces no output VAT, so the exempt category VAT amount must be exactly zero and must not contribute to the invoice VAT total. In practice, the error occurs when software applies the standard rate to the E base or copies the tax amount of another breakdown.

Solution

Set the exempt cac:TaxSubtotal/cbc:TaxAmount (BT-117) to 0.00; an exempt supply generates no VAT.

Quick actions

Validate XML Convert invoice

Valid Examples

Exempt breakdown with BT-118 = E and BT-117 = 0.00

Invalid Examples

Exempt breakdown with BT-118 = E but BT-117 = 95.00

Code Examples

Valid XML

<cac:TaxSubtotal>
  <cbc:TaxableAmount currencyID="EUR">500.00</cbc:TaxableAmount>
  <cbc:TaxAmount currencyID="EUR">0.00</cbc:TaxAmount>
  <cac:TaxCategory>
    <cbc:ID>E</cbc:ID>
    <cbc:Percent>0</cbc:Percent>
    <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
  </cac:TaxCategory>
</cac:TaxSubtotal>

Invalid XML

<cac:TaxSubtotal>
  <cbc:TaxableAmount currencyID="EUR">500.00</cbc:TaxableAmount>
  <cbc:TaxAmount currencyID="EUR">95.00</cbc:TaxAmount>
  <cac:TaxCategory>
    <cbc:ID>E</cbc:ID>
    <cbc:Percent>0</cbc:Percent>
    <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
  </cac:TaxCategory>
</cac:TaxSubtotal>