BR-Z (Zero-rated VAT rules)

BR-Z is the set of European e-invoice rules governing zero-rated VAT.

Definition

In the EN 16931 semantic model, each VAT category is governed by a family of business rules identified by a prefix. The BR-Z prefix covers category Z, known as zero rated, where the supply stays within the scope of VAT but is taxed at a rate of 0%.

What the rules check

The BR-Z rules require, among other things, that:

• the VAT rate on the line or breakdown equals 0;
• the VAT amount calculated for category Z is therefore zero;
• the taxable base of the breakdown matches the sum of the line amounts assigned to that category.

Unlike the "exempt" category (E), category Z does not require an exemption reason.

Good to know

Zero rating is legally distinct from exemption: the transaction is still taxable, which can preserve the right to deduct input VAT. An invoice that declares category Z but shows a non-zero rate will be rejected by any validator that conforms to EN 16931.