ZUGFeRD 2.1/ Factur-X 1.0 for Dynamics 365 FO

ZUGFeRD 2.1/ Factur-X 1.0 for Dynamics 365 FO

We are excited to announce the release of the common German-French electronic invoice ZUGFeRD / Factur-X in Dynamics 365 for Finance and SCM. This plug-and-play solution in its “Light” version does not require any customisation and can be easily installed in the standard Electronic Reporting module of D365. It supports the ZUGFeRD 2.1.1/Factur-X 1.0 profile EN 16931, also known as the “COMFORT” profile, which meets all tax law requirements and must be accepted by customers unless explicitly denied.

In the ZUGFeRD/Factur-X standard, the invoicing information is included in an XML payload attached to a human-readable PDF file (see https://de.wikipedia.org/wiki/ZUGFeRD). This is in contrast to the Italian electronic invoicing system, where a PDF is embedded in a Base64 encoded block within an XML. The PDF document is just a visualisation of the electronic content, what counts is the XML attachment. The XML file is always named factur-x.xml and it is attached to at the PDF document level, not to a single PDF page:

Here is an example: factur-x.xml

Our solution, which utilizes Configurable business documents in D365, supports Sales invoices with separate buyer, seller, and order accounts. Other types of invoices such as the Free text invoice or any of the 3 Project invoices, can be provided upon request at a discounted price. Our solution also handles form notes, line and header notes and footers, line discounts, total discounts, and cash discounts, document level charges, properly reflecting VAT for domestic, EU, and export sales. The settlement instructions orchestrate a SEPA credit transfer or a SEPA direct debit withdrawal; partially prepaid invoices are properly interpreted. The solution is available in French, German, and British English.

Price

The solution is offered at a fixed fee per end customer / D365 tenant:
Version Price Deliverables Notes
Light €890 A ZUGFeRD Sales invoice ER configuration, the XML file only This option does not require any X++ customisations or 3rd party software and can be installed and used right away.
Light+ €1200 Same as the Light version but with 5 hours of prepaid support and installation  
Heavy €2200 Contains the full solution, including a PDF template, and a PDF post-processor with 8 hours of prepaid support. Includes the iTextSharp 5.5.13.2 .NET library under the GNU Affero General Public License
Includes the BouncyCastle 1.8.9 .NET cryptographic library under a variant of the MIT license.

Setup and use

 
  1.  Import the Electronic configuration “ZUGFeRD Sales invoice” provided to you (Organisation administration > Electronic reporting > Configurations, button Exchange / Load from XML file). For the ease of installation, configuration and integration, the standard Invoice model Invoice model v 277 and the standard Invoice model mapping 277.258 are used, make sure they have been imported upfront.
  2. Beware: the standard Invoice model mapping from Microsoft has a number of shortcomings. For instance, the buyer and seller addresses are passed in a de-normalized form as multi line strings. As a walkaround, some heuristics and regular expressions have been applied to extract the ISO2 code of the country and the zip (postal) code. A well-known modification to the standard Invoice model mapping will fix that and reinforce the report. Futhermore, the current Microsoft Invoice model mapping does not pass the EU Tax directives to the report. At the moment, the report relies on the non-EU Tax exempt codes in the same way as the standard Excel invoice does. To leverage the Tax directives, fix the model mapping, then modify the ZipFolder/InvoicePDF/SalesTax/SalesTax* mappings in ZUGFeRD Sales invoice format like this:
    IF(OR(@.Value.TaxExemptDescription<>"",@.Value.TaxDirective<>""),
    IF(@.Value.TaxExemptDescription<>"",@.Value.TaxExemptDescription,@.Value.TaxDirective),
    @"GER_LABEL:PlusVAT")
  3. Under the button Configurations / Application specific parameters / Setup, provide a mapping of the VAT (en-us: Sales tax) Print codes to the ZUGFeRD categories S, K, AE, G, O (for example, the 19% and 7% VAT belong to the “S” category). Also provide a mapping of the D365 Unit of measure codes to the UNECE Recommendation No. 20 list called “Codes for Units of Measure Used in International Trade” (see https://tfig.unece.org/contents/recommendation-20.htm). For instance, a piece has the standard code H87. A sample parameter setup can be downloaded here: 03-01-2023 03.29.45 pm_ZUGFeRD Sales invoice.277.11
  4. Pay attention to the sample VAT print codes on the screenshot above: the standard Invoice model mapping does not pass the tax rates to the report, and the VAT Print code must contain the VAT rate in numbers, if applicable. In other words, they should look like “19%” and “7%” in Germany or “20%” and “5,5%”in France. The mapping of the sales units of measure is against the language-specific, translated unit code (if exists), not the UoM symbol used in D365 globally, i.e. not pcs but Stk. Once both the mappings have been established, set the Application specific parameters State to Completed.
  5. Open Sales ledger (en-us: Accounts receivable) > Setup > Forms > Form setup. Make sure that the VAT specification option is set to Registration currency. You will also probably Print VAT number on invoice, show some invoice line inventory dimensions and/or notes, and display external item numbers (Item number in forms = Both).
  6. Finally, open Print management and select the Report format = ZUGFeRD Sales invoice at the Customer invoice node. The Light version setup ends here.
  7. For the Heavy version, first deploy the X++ customisations and libraries provided.
  8. Create a new File document type in the Organisation administration > Document management > Document types list. Name it exactly like this: ZUGFeRD.
  9. Create a new ER destination (Organisation administration > Electronic reporting > Electronic reporting destination) for the report ZUGFeRD Sales invoice. Under File destination, add a new line and divert the ZipFolder file component to the Archive: click Settings, then Archive, set Enabled and Save in job archive, and choose file Type = ZUGFeRD. The Archive destination is namely the only one to plug in/subscribe to.
  10.  Make sure that the feature Configure action-dependent ER destinations is turned OFF: https://learn.microsoft.com/en-us/dynamics365/fin-ops-core/dev-itpro/analytics/er-action-dependent-destinations. It doesn’t work well anyway.
  11. The steps to configure the Heavy version end here. The Electronic Reporting engine will fill out the PDF form, populate an XML file and put both into a ZIP (i.e. a folder). This ZIP file is intercepted, unpacked, and the XML part is embedded into the PDF, adding some links and attributes required. The resulting PDF is rendered on the screen in a separate browser window. Other output destinations than the Screen may be offered upon request at a discounted price. The PDF file is not fully PDF-A/3 compliant, but it can be read and parsed, the XML payload passes all validations. Please bear in mind that PDF forms never contain repeatable ranges or cells. This is the reason why the number of invoice lines is currently limited by 10, this number will be extended on demand; see also Design ER configurations to fill in PDF templates – Finance & Operations | Dynamics 365 | Microsoft Learn.
  12. Print or reprint an invoice with the option Use print management turned on.
  13. The resulting PDF document is displayed on the screen (the Light version offers an XML file to download). Here is a sample, you buy what you see:



Useful links:

Sometimes you pay Reverse Charge in D365

Sometimes you pay Reverse Charge in D365

Under the “reverse charge system” it is the company receiving the service that is liable to pay the VAT, and not the company providing the service. Normally, the net amount of VAT to pay is offset by the same amount of the receivable VAT, and the tax burden remains 0. But not always: sometimes the tax office wins. These are 2 cases I’ve got this year:

    • A service was provided by an EU entrepreneur who had no EU VAT number. The invoice was VAT excluded, but I had to calculate the VAT payable (reporting code 1157 „Steuerschuldübergang bei Bezug gemäß § 19 Abs. 1 zweiter Satz, § 19 Abs. 1c“ in Austria, code 47 „Steuer, im Inland steuerpflichtige sonstige Leistung eines EU Unternehmers § 13b Abs. 1 UStG“ in Germany), while the VAT receivable was nil (otherwise reported as 1166 „Vorsteuer: Steuerschuldübergang gemäß §19, grenzüberschreitende Leistungen“ in Austria or code 67 „Vorsteuer aus Umsätzen nach §13b Abs. 2 Nr. 11“ in Germany).
    • There are more and more citizens who sell excess solar power to the grid, thanks to the overall trend, public incentives and the war. This falls under an obscure, but less and less exotic Reverse Charge regime for producers/resellers of electricity (reporting code 1132 “Steuerschuldübergang bei Bezug gemäß § 19 Abs. 1d: Gas und Elektrizität“ in Austria). If they resell, they have a deductible VAT to offset. But if they produce, they have to pay on top of the Credit note granted to them by an energy company or the authority.

Solution in Dynamics 365 for Finance

The 2 business cases have the same process in common:
– One becomes an invoice (or a credit note) from a supplier (vendor) over €100
– One pays (or receives) €100 to the supplier
– One pays €20 (€19) to the tax office
 
To implement this in Dynamics 365 for Finance, we activate the Use tax in the VAT group (en-us: Sales tax group) as usual (see Minimalistic EU VAT configuration in D365):

On top of that, the special VAT code (here: ServEUnond) for the non-deductible Reverse Charge receives Non deductible % = 100% in the tax code value:
 
The use tax VAT from the supplier invoice calculated in this way “elongates” the original expense, the GL voucher reflects the fact that the service effectively becomes more expensive by 19% (in DE):
This may be considered right or wrong, but a different expense account such as 7xxx “VAT, non-deductible” is not possible in standard Dynamics 365. If needed, this tax expense may be reallocated to a different account manually at the end of the period.
 
The monthly/quarterly Tax > Declaration > VAT > Settle and post VAT operation does not find any VAT receivable to offset the VAT payable and transfers the liability into the Tax authority’s payable account:
Bingo!

Enumerate lines in Configurable Business Documents

Enumerate lines in Configurable Business Documents

The delivery note, invoice etc. Report Data Providers in Dynamics 365 for Finance do not expose line numbers for no obvious reason. For instance, the SalesInvoiceTmp  table sent from D365 to the report renderer – whatever it is – misses the line number. The situation becomes dire when it comes to Electronic Reporting / Configurable Business Documents.

The ENUMERATE(Lines) function applied to the lines makes a totally new object {Number, Value} and every binding “@” becomes “@.Value“. This is a massive change in the report, very hard to maintain and upgrade (rebase).

In XML or CSV outbound formats there is a Counter element, it auto-counts itself. In Excel and Word outbound formats there are just RangesCells. I thought we worked with lists as isolated objects and there were no internal variables in Electronic Reporting which were aware of the execution history.

But today I finally understood what the DATA COLLECTION does. It is a listener, you pass a value to it, it returns it back unchanged but keeps a global variable to count and summarise the values.

For example, to enumerate delivery note (en-us: packing slip) lines, first create a root Data collection class of the integer type in the Mapping to the right, Collect all values = Yes, let’s call it a LineNumberCollection.

Then put the following formula into the Excel Cell with the line number:
LineNumberCollection.Collect(1)+LineNumberCollection.Sum(false)-1 

The first LineNumberCollection.Collect() call takes 1, records 1 internally, and returns the 1 back into the cell. The second call LineNumberCollection.Sum(false) adds the running total of 1’es recorded so far. The last operand subtracts 1.

Here is the result: Bingo!