Preparing your business for Brexit

At the time of writing, there is still huge uncertainty as to whether the UK will secure a deal with the EU before 31^st October 2019 or leave without a deal.

There are many issues to consider (too many for one blog post!) so we have just highlighted some key matters that owner-managers of small businesses can focus on now and plan for, should the EU leave without a deal:

How will demand for your products/services change?

In the lead up to and shortly after Brexit, you may see bigger fluctuations in demand. Additional customs duties may also affect your sales and supply chain. Even if you do not do business directly with anyone in the EU, someone above or below you in the supply chain will!

You should be talking to your customers and suppliers now to ascertain what their expectations are so that you have enough time to stock to the right levels.

You should also consider if you could benefit from simplified import procedures. They mean you may not need to settle VAT and duties (if any) on imports immediately at port but businesses will need to register to use them.

How will your cash flow change?

Although you may not know the answer to this, you should consider your current methods of financing. What’s available to you now and what your options are if it were to change? For example, if you regularly maximise your overdraft, what would you do if this could not be extended? What would you do if your customers asked you for more time to pay?

We are happy to undertake some different scenario planning with you and to help you maximise cash flow. In fact, even if you don’t think Brexit will impact your business, it is still highly recommended that you consider this.

Do you know how changes to VAT will affect you?

The Government have stated their aim is to keep VAT procedures as close as possible to the current rules. However, there will be several changes that impact businesses that trade with the EU.

For example, if you import goods from the EU, the rules for imports from non-EU countries will now also apply to imports from the EU, with some additional requirements.

VAT registered UK businesses will continue to be able to zero-rate sales of goods to EU businesses. They will no longer have to complete an EC Sales List. Instead, those UK businesses exporting zero-rated goods to EU businesses will need to retain evidence to prove that goods have left the UK. Such evidence is already required for exports to non-EU countries, and any new requirements should be very similar.

It’s crucial that owner-managers know exactly what to do and should speak to us about their specific circumstances to ensure they comply with the law.

Are any of your employees EU (or even EAA or Swiss) nationals?

If so, ensure those employees are aware of the settlement scheme and the need to register. They will need to be living in the UK before it leaves the EU to apply. If there is no deal, the deadline for applying will be 31 December 2020.

Please use the EU Settlement Scheme Employer toolkit to help you communicate this to your employees.

In addition to the above, some other issues you might also want to consider and speak to us about in a “no deal” scenario are:

1. How will your principal contracts be affected by Brexit?
2. Do you receive personal data from the EU/EAA?
3. What help do you need to access potential new markets?
4. Are you ready for customs? Have you got your Economic Operators Registration and Identification (EORI) number?
5. Do your corporate reports reflect Brexit?

Even with a “deal”, the consequences for UK business are still likely to be significant.

As your all-round adviser, we are ideally placed to help you consider your options to minimise the threats to your business and maximise opportunities that may be available.

With 31^st October fast-approaching, please one of our advisers a call now on 01474 853856 or email us at discovery@a4g-llp.co.uk to discuss how we can help.