# BR-O-13: Keep document level allowances in category O on a not subject to VAT invoice
When the VAT breakdown is in category `O`, each document-level allowance must be in `O` as well; a discount coded `S` at 20 on such a document is rejected.
- Layer: EN 16931
- Severity: fatal (the document is invalid)
- Topics: VAT, Allowances and charges
- Official definition: https://docs.peppol.eu/poacc/billing/3.0/rules/ubl-tc434/BR-O-13/
- Explanation last updated: 2026-09-28
## The short answer
`BR-O-13` fails when the document has an `O` VAT breakdown and an allowance, a `cac:AllowanceCharge` with `cbc:ChargeIndicator` `false`, whose `cac:TaxCategory` is in any other category under the `VAT` scheme. In the recorded invoice the `Loyalty discount` of 5.00 is coded `S` at 20 while the line and the breakdown are `O`. Put the allowance back in `O`, without a rate, and deduct it in the `O` taxable amount.
A discount takes the VAT treatment of what it reduces. On an invoice where everything is outside the scope of VAT, a Standard rated discount would be reducing VAT that was never charged.
## What the rule checks
After finding an `O` breakdown, the rule counts `cac:TaxCategory` elements under the `VAT` scheme with a `cbc:ID` other than `O` inside allowances, wherever those allowances are, and needs the count to be zero. `BR-O-11` does not see this case, because no second breakdown exists.
The search reaches below the root. When tried, an allowance of 0.00 inside the `O` line, with a `cac:TaxCategory` of `S` at 20, reported this rule with `BR-S-01`, `BR-S-03` and the warning `UBL-CR-558`, which advises against a tax category on a line allowance.
Any other category is caught. With the discount coded `E` at 0 instead, the findings were this rule, `BR-E-01` and `BR-E-03`; coded `Z` at 0, this rule, `BR-Z-01` and `BR-Z-03`.
Giving the Standard rated discount a breakdown of its own only changes the company this rule keeps: when tried, an `S` breakdown of -5.00 replaced `BR-S-01` with `BR-O-11`, and this rule and `BR-S-03` stayed.
| Term | Meaning | UBL element |
|---|---|---|
| BG-20 | Document level allowances | `cac:AllowanceCharge[cbc:ChargeIndicator = false]` |
| BT-95 | Document level allowance VAT category code | `cac:AllowanceCharge[cbc:ChargeIndicator = false]/cac:TaxCategory/cbc:ID` |
| BT-118 | VAT category code | `cac:TaxTotal/cac:TaxSubtotal/cac:TaxCategory/cbc:ID` |
## How an integration ends up here
Possible causes, from the shape of the rule rather than from measured usage:
- Discounts are created from a template that carries the Standard rate, whatever the category of the invoice they are added to.
- The discount copies its category from the seller's default tax code instead of from the lines it reduces.
- A promotion engine outside the invoicing system adds the allowance with its own tax settings.
## How to fix it
1. Work out which lines the allowance reduces. If they are all in `O`, the allowance belongs in `O` as well.
2. Change the allowance's `cac:TaxCategory/cbc:ID` to `O` and delete its `cbc:Percent`, as `BR-O-06` requires.
3. Deduct the allowance in the `O` breakdown: in the recorded example the `O` taxable amount goes from 25.00 to 20.00, in line with the totals, which already deduct the discount.
4. If the allowance really relates to taxable supplies, those supplies and the allowance belong on a separate invoice with their own breakdown.
## Before and after
These are fragments, not complete documents. The complete synthetic documents they come from are linked below.
Fragment of the failing invoice: a Standard rated loyalty discount on a document whose only breakdown is O
```xml
false
95
Loyalty discount
5.00
S
20
VAT
0.00
25.00
0.00
O
VAT
```
Fragment of the corrected invoice: the discount is in O and deducted in the O breakdown
```xml
false
95
Loyalty discount
5.00
O
VAT
0.00
20.00
0.00
O
VAT
```
In the failing invoice the `Loyalty discount` has `cbc:ID` `S` and `cbc:Percent` `20`, and the `O` taxable amount is 25.00, the line without the discount; the corrected invoice codes the discount `O` with no rate and deducts it, giving 20.00. The failing breakdown was set to 25.00 so that it matches its own `O` content and `BR-O-08` stays quiet; with the discount recoded alone, that rule joined the findings when tried. The failing document also reports `BR-S-01`, since the Standard rated allowance has no Standard rated breakdown, and `BR-S-03`, since a Standard rated allowance needs a seller VAT identifier, a tax registration identifier or a tax representative.
### What the validator reported
- The failing invoice reports **BR-O-13**, [BR-S-01](https://ironfang.com/docs/finance/rules/BR-S-01.md) and [BR-S-03](https://ironfang.com/docs/finance/rules/BR-S-03.md). The corrected document passes every layer with no findings.
- [Download the failing XML](https://ironfang.com/finance/rule-examples/BR-O-13-invalid.xml)
- [Download the corrected XML](https://ironfang.com/finance/rule-examples/outside-scope-allowance-valid.xml)
Recorded on phive 12.1.0 / phive-rules-peppol 4.5.6 / Saxon-HE 12.10, the engine behind the free validator, using synthetic data. A recorded result is regression evidence for these documents; it is not a certification.
## Where it applies
- Applies to UBL `Invoice` and `CreditNote`; the credit note version of the failing invoice reported the same three findings when tried.
- Lines and charges have the matching rules `BR-O-12` and `BR-O-14`. Only an `O` breakdown switches the three on; an allowance in `O` on a document with no `O` breakdown is a matter for `BR-O-01`.
## Related rules
- [BR-O-14 is the same restriction for document level charges](https://ironfang.com/docs/finance/rules/BR-O-14.md)
- [BR-O-12 is the same restriction for invoice lines](https://ironfang.com/docs/finance/rules/BR-O-12.md)
- [BR-S-03 is reported here because a Standard rated allowance needs a seller identifier for VAT or tax](https://ironfang.com/docs/finance/rules/BR-S-03.md)
- [BR-O-06 applies once the allowance is back in category O, and forbids its rate](https://ironfang.com/docs/finance/rules/BR-O-06.md)
## Scope and source
Written for Peppol BIS Billing 3.0.21 (May 2026), EN 16931 1.3.16, as applied to UBL 2.1 Invoice and CreditNote documents. Other profiles, syntaxes and releases can define this identifier differently. Guidance version 2026-09-28.1: source checked 2026-09-28, explanation last updated 2026-09-28.
[The official definition of BR-O-13](https://docs.peppol.eu/poacc/billing/3.0/rules/ubl-tc434/BR-O-13/) carries the normative wording and test. This page is our explanation of it, not a copy.
Guidance does not change the engine verdict. Fixing this finding does not mean the document passes every layer, and validation does not certify legal or tax compliance or transmit a document over Peppol.
## Links
- [This rule as a web page](https://ironfang.com/docs/finance/rules/BR-O-13)
- [Free Peppol invoice validator](https://ironfang.com/tools/peppol-validator)
- [Rule index](https://ironfang.com/docs/finance/rules.md)
- [Ironfang Finance API docs](https://ironfang.com/docs/finance)
- The same rule is available to MCP clients as the tool `finance.rule.get` on https://mcp.ironfang.com/mcp