Reference

BR-E-10 Exempt VAT breakdown needs an exemption reason code or text

A VAT breakdown (BG-23) with VAT category code (BT-118) "Exempt from VAT" (E) shall have a VAT exemption reason code (BT-121) or a VAT exemption reason text (BT-120).

VAT exemption (category E) must state its legal basis, so EN16931 requires either a coded or free-text exemption reason on the exempt breakdown; codes come from the VATEX list validated by BR-CL-22. In practice, the error occurs when the exemption note is printed only in the invoice footer and not written into BT-120 or BT-121.

Solution

Add a cac:TaxCategory/cbc:TaxExemptionReasonCode (BT-121) from the VATEX code list or a cbc:TaxExemptionReason free text (BT-120) to the exempt breakdown.

Quick actions

Validate XML Convert invoice

Valid Examples

Exempt breakdown with BT-121 = VATEX-EU-132 or BT-120 = "Exempt under Art. 132 VAT Directive"

Invalid Examples

Exempt breakdown (BT-118 = E) with neither BT-120 text nor BT-121 code

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>
    <cbc:TaxExemptionReasonCode>VATEX-EU-132</cbc:TaxExemptionReasonCode>
    <cbc:TaxExemptionReason>Exempt under Article 132 VAT Directive</cbc:TaxExemptionReason>
    <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">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>