BR-Z-10: Zero-rated breakdown must not carry an exemption reason

StandardEN 16931-1 (European e-invoicing semantic model)SeverityError: the invoice is rejectedSyntaxUBL, CIIBusiness terms

BG-23 VAT breakdown
BT-118 VAT category code
BT-120 VAT exemption reason text
BT-121 VAT exemption reason code

Applies toEvery EN 16931 invoice: XRechnung, ZUGFeRD 2.x / Factur-X (profiles EN 16931, EXTENDED, XRECHNUNG), Peppol BIS Billing 3.0, and national CIUS such as the Dutch NLCIUS or the Italian/Spanish profiles.

Official rule text

[BR-Z-10] A VAT breakdown (BG-23) with VAT Category code (BT-118) "Zero rated" shall not have a VAT exemption reason code (BT-121) or VAT exemption reason text (BT-120).

Why this error occurs

A VAT breakdown with category Z (zero rated) is taxable at 0 %, so there is no exemption to justify; the rule forbids cbc:TaxExemptionReason and cbc:TaxExemptionReasonCode in the cac:TaxCategory with ID Z (UBL) and ram:ExemptionReason / ram:ExemptionReasonCode in the ram:ApplicableTradeTax with CategoryCode Z (CII). The error typically comes from software that writes a reason text for every 0 % category, or from confusing zero rated with exempt.

How to fix it

Remove the exemption reason elements from the Z breakdown. If the supply is actually exempt by law (e.g. medical services, intra-community supply, export), the correct category is E, K or G respectively, which do require a reason; Z is only for goods and services that are legally taxed at a zero rate. Keep cbc:Percent 0 and cbc:TaxAmount 0.00.

Example (valid)

<cac:TaxCategory>
  <cbc:ID>Z</cbc:ID>
  <cbc:Percent>0</cbc:Percent>
  <cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>

What the validator checks

Checked element (context):

UBL

/*/cac:TaxTotal/cac:TaxSubtotal/cac:TaxCategory[normalize-space(cbc:ID) = 'Z'][cac:TaxScheme/normalize-space(upper-case(cbc:ID))='VAT']

Test (XPath):

not((cbc:TaxExemptionReason) or (cbc:TaxExemptionReasonCode))

CII

//ram:ApplicableHeaderTradeSettlement/ram:ApplicableTradeTax/ram:CategoryCode[. = 'Z']

Test (XPath):

not(../ram:ExemptionReason) and not (../ram:ExemptionReasonCode)

Check your invoice

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Same check via API:

curl -F file=@invoice.xml https://einvoicechecker.com/v1/validate

Related rules

BR-AE-10 Reverse-charge breakdown without exemption reason
BR-AF-10 A VAT breakdown with VAT Category code "IGIC" shall not have a VAT exemption reason…
BR-AG-10 A VAT breakdown with VAT Category code "IPSI" shall not have a VAT exemption reason…
BR-E-10 VAT-exempt breakdown without exemption reason
BR-G-10 A VAT breakdown with the VAT Category code "Export outside the EU" shall have a VAT…
BR-IC-10 A VAT breakdown with the VAT Category code "Intra-community supply" shall have a VAT…
BR-O-10 A VAT breakdown with VAT Category code " Not subject to VAT" shall have a VAT…
BR-S-10 A VAT breakdown with VAT Category code "Standard rate" shall not have a VAT exemption…

Frequently asked questions

What does BR-Z-10 mean?

BR-Z-10 is a en 16931 core rule: A VAT breakdown (BG-23) with VAT Category code (BT-118) "Zero rated" shall not have a VAT exemption reason code (BT-121) or VAT exemption reason text (BT-120).

Will my invoice be rejected because of BR-Z-10?

Yes. BR-Z-10 is flagged "fatal"; validators (KoSIT, Peppol access points, the German ZRE/OZG-RE portals) reject the invoice until it is fixed.

Which formats does BR-Z-10 apply to?

Every EN 16931 invoice: XRechnung, ZUGFeRD 2.x / Factur-X (profiles EN 16931, EXTENDED, XRECHNUNG), Peppol BIS Billing 3.0, and national CIUS such as the Dutch NLCIUS or the Italian/Spanish profiles. Syntax: UBL and CII.

Source: EN 16931-1:2017 schematron (CEN TC434, via Peppol BIS 3.0.20). Catalogue generated from the official schematron on 2026-10-14.