Guides

EN-16931: VAT Reverse Charge (AE)

This code specifies that the standard Tax rate is levied from the document.

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Party IDs

If a Document contains a line where the invoiced item's Tax Category Code is Reverse Charge, or an allowance or charge with the same Tax Category Code, then you must include the Supplier's Tax Registration ID and/or the their Tax Representative's ID.

If one of the following elements exists:

  • Invoice/InvoiceLine/Item/ClassifiedTaxCategory/ID = AE

or

  • /Invoice/AllowanceCharge[ChargeIndicator='false']/TaxCategory/ID = AE

or

  • /Invoice/AllowanceCharge[ChargeIndicator='true']/TaxCategory/ID = AE

Then the following elements are required:

  • /Invoice/AccountingSupplierParty/Party/PartyTaxScheme/CompanyID
  • /Invoice/TaxRepresentativeParty/Party/PartyTaxScheme/CompanyID

The Buyer's Tax Registration ID and the Buyer's legal entity are also required:

  • /Invoice/AccountingCustomerParty/Party/PartyTaxScheme/CompanyID
  • /Invoice/AccountingCustomerParty/Party/PartyLegalEntity/CompanyID

Tax Rate

If an invoiced item's Tax Category is Reverse Charge, the tax rate for the item must be zero.

If Invoice/InvoiceLine/Item/ClassifiedTaxCategory/ID = AE, then Invoice/InvoiceLine/Item/ClassifiedTaxCategory/Percent must be zero.

If a Document-level Allowance's Tax Category is Reverse Charge, the Document-level allowance's tax rate must be zero.

If Invoice/AllowanceCharge[ChargeIndicator='false']/TaxCategory/ID = AE, then Invoice/AllowanceCharge[ChargeIndicator='false']/TaxCategory/Percent must be zero.

If a Document-level Charge's Tax Category is Reverse Charge, the Document-level charge's tax rate must be zero.

If Invoice/AllowanceCharge[ChargeIndicator='true']/TaxCategory/ID = AE, then Invoice/AllowanceCharge[ChargeIndicator='true']/TaxCategory/Percent must be zero.

Tax Amount

If a Tax Total includes a Tax Category Code that is Exempt from VAT, the Tax Amount must be zero.

If Invoice/TaxTotal/TaxSubtotal/TaxCategory/ID = AE, then Invoice/TaxTotal/TaxSubtotal/TaxAmount must be zero.

Tax Exemption

For example, if Invoice/cac:TaxTotal/cac:TaxSubtotal/cac:TaxCategory/cbc:ID = AE, then one of the the following elements must be provided:

  • /Invoice/TaxTotal/TaxSubtotal/TaxCategory/TaxExemptionReasonCode = VATEX-EU-AE

or

  • Invoice/TaxTotal/TaxSubtotal/TaxCategory/TaxExemptionReason = Educational Book Exempt from VAT

Example

The following is an example of a reverse charge Tax Category on the line level:

<Invoice>
    <!-- code omitted for clarity -->
    <cac:AccountingSupplierParty>
        <cac:Party>
            <cac:PartyTaxScheme> 
                <!-- Seller Tax Registration Identifier -->
                <cbc:CompanyID>EE76576657</cbc:CompanyID>
                <cac:TaxScheme>
                    <cbc:ID>VAT</cbc:ID>  
                </cac:TaxScheme>
            </cac:PartyTaxScheme>
            <!-- code omitted for clarity -->
        </cac:Party>
    </cac:AccountingSupplierParty>
    <cac:AccountingCustomerParty>
        <cac:Party>
            <cac:PartyTaxScheme> 
                <!-- Buyer Tax Registration Identifier -->
                <cbc:CompanyID>EE22334455</cbc:CompanyID>
                <cac:TaxScheme>
                    <cbc:ID>VAT</cbc:ID>  
                </cac:TaxScheme>
            </cac:PartyTaxScheme>
            <cac:PartyLegalEntity>  
                <cbc:RegistrationName>Buyer Official Name Ltd.</cbc:RegistrationName>  
                <!-- Buyer Legal Registration Identifier -->
                <cbc:CompanyID>EE12345600</cbc:CompanyID>  
            </cac:PartyLegalEntity>
            <!-- code omitted for clarity -->
        </cac:Party>
    </cac:AccountingCustomerParty>
    <!-- code omitted for clarity -->
    <cac:TaxTotal>
        <cbc:TaxAmount currencyID="EUR">0.00</cbc:TaxAmount>
        <cac:TaxSubtotal>
            <cbc:TaxableAmount currencyID="EUR">1325</cbc:TaxableAmount>
            <cbc:TaxAmount currencyID="EUR">0.00</cbc:TaxAmount>
            <cac:TaxCategory>
                <!-- Tax Category Code -->
                <cbc:ID>AE</cbc:ID>
                <cbc:Percent>0.00</cbc:Percent>
                <cbc:TaxExemptionReasonCode>VATEX-EU-AE</cbc:TaxExemptionReasonCode>
                  <cbc:TaxExemptionReason>Reverse Charge</cbc:TaxExemptionReason>              
                <cac:TaxScheme>
                    <cbc:ID>VAT</cbc:ID>
                </cac:TaxScheme>
            </cac:TaxCategory>
        </cac:TaxSubtotal>
    </cac:TaxTotal>
    <!-- code omitted for clarity -->
    <cac:InvoiceLine>
        <!-- code omitted for clarity -->
        <cac:Item> 
            <cac:ClassifiedTaxCategory>
                <!-- Tax Category Code -->
                <cbc:ID>AE</cbc:ID>
                <cbc:Percent>0.00</cbc:Percent>
                <cac:TaxScheme>
                    <cbc:ID>VAT</cbc:ID>
                </cac:TaxScheme>
            </cac:ClassifiedTaxCategory>
        </cac:Item> 
        <!-- code omitted for clarity -->
    </cac:InvoiceLine>
    <!-- code omitted for clarity -->
</Invoice>

Updated 7 days ago