BR-E-1
Exempt Category Used but No Single 'E' VAT Breakdown (BG-23)
What This Error Means
If any invoice line, document-level allowance or charge uses VAT category E (exempt from VAT), the VAT breakdown (BG-23) must contain exactly one breakdown with category E. The KoSIT report prints the rule as [BR-E-01]. The rule counts the E breakdowns: none fails, and two fail as well. The exemption reason for that breakdown is a separate rule, BR-E-10. The rule is fatal.
Why this happens
The rule looks for category E anywhere in the invoice: in line categories (cac:ClassifiedTaxCategory) and in document-level cac:AllowanceCharge/cac:TaxCategory. If it finds one, the count of E breakdowns in cac:TaxTotal must be exactly 1. Typical causes: the lines are marked E but the software still writes an S breakdown with 0 %; the breakdown is missing entirely because the tax amount is zero; E lines with different descriptions were split into two E breakdowns; or small businesses under § 19 UStG use category E in the lines but O or Z in the breakdown. In XRechnung the breakdown also needs a rate (BR-DE-14), so write 0.
How to Fix It
Add exactly one cac:TaxSubtotal with category E: taxable amount = sum of all E lines (plus E charges, minus E allowances), tax amount 0.00, rate 0, and an exemption reason in cbc:TaxExemptionReason (BT-120) or cbc:TaxExemptionReasonCode (BT-121).
Step-by-step
1) Check that E is the right category. Exempt supplies under § 4 UStG and small businesses under § 19 UStG use E; reverse charge uses AE; intra-community supplies use K; exports outside the EU use G. 2) Collect all lines and document-level allowances/charges with E. 3) Create one cac:TaxSubtotal: cbc:TaxableAmount = their sum, cbc:TaxAmount 0.00, cac:TaxCategory with cbc:ID E and cbc:Percent 0. 4) Add the legal basis in cbc:TaxExemptionReason (BT-120) and/or a VATEX code in cbc:TaxExemptionReasonCode (BT-121); BR-E-10 requires one of them. 5) Keep the line rate at 0 (BR-E-05). 6) Seller identification: BR-E-02 requires BT-31, BT-32 or BT-63, so small businesses without a VAT ID give their Steuernummer with TaxScheme FC. 7) Validate again.
<!-- Small business under § 19 UStG -->
<cac:TaxSubtotal>
<cbc:TaxableAmount currencyID="EUR">1500.00</cbc:TaxableAmount>
<cbc:TaxAmount currencyID="EUR">0.00</cbc:TaxAmount>
<cac:TaxCategory>
<cbc:ID>E</cbc:ID>
<cbc:Percent>0</cbc:Percent>
<cbc:TaxExemptionReason>Kein Ausweis von Umsatzsteuer, da Kleinunternehmer gemäß § 19 UStG</cbc:TaxExemptionReason>
<cac:TaxScheme><cbc:ID>VAT</cbc:ID></cac:TaxScheme>
</cac:TaxCategory>
</cac:TaxSubtotal>Fix Automatically
Upload your invoice to our Smart Repair engine. It checks the file against the full KoSIT rule set, including BR-E-1, and corrects supported fields with a GoBD audit trail.
Open Smart RepairFrequently asked questions
Which category does a small business (§ 19 UStG) use?
Category E with rate 0 in the lines and one E breakdown, with an exemption reason that refers to § 19 UStG.
Is exempt (E) the same as reverse charge (AE)?
No. E is a VAT exemption. AE is the reverse charge mechanism where the buyer owes the VAT. Each has its own breakdown rule (BR-E-01, BR-AE-01) and its own exemption reason rule (BR-E-10, BR-AE-10).
Where does the exemption reason go?
Into the E breakdown: cbc:TaxExemptionReason (text, BT-120) and/or cbc:TaxExemptionReasonCode (VATEX code, BT-121) inside cac:TaxCategory. It is checked by BR-E-10, not by BR-E-01.
Related Errors
Other commonly encountered validation errors