Invalid Tax Category Code Detected
.png)
Error in compliance: {"validationResults":{"infoMessages": [{"type":"INFO","code":"XSD_ZATCA_VALID","category":"XSD validation","message":"Complied with UBL 2.1 standards in line with ZATCA specifications","status":"PASS"}],"warningMessages":[],"errorMessages": [{"type":"ERROR","code":"BR-CL-18","category":"EN_16931","message":"Invoice tax categories MUST be coded using UNCL5305 code list","status":"ERROR"}],"status":"ERROR","reportingStatus":"NOT_REPORTED", clearanceStatus":null,"qrSellerStatus":null,"qrBuyerStatus":null}
Solution:
This error typically occurs due to an incorrect tax category code in the invoice. According to ZATCA's requirements, tax category codes must follow the rules defined in the Code List 5305 (UNCL5305). These standardized codes are essential to indicate how taxes apply to different items or services in a compliant manner. Common codes include:
- S (Standard Rate): The regular tax rate applies.
- Z (Zero Rate): Tax is applied, but the rate is 0%.
- E (Exempt): No tax is applied because the item or service is tax-exempt.
- O (Out of Scope): The item or service does not fall under tax regulations.
To prevent validation errors, ensure that the correct tax category code is used in the invoice based on the nature of the item or service. Failure to do so will trigger compliance errors like the one shown.