With the United Kingdom (UK) opting to withdraw from the European Union (EU) on the 31st January 2020, and with the transitional arrangements due to end on the 31st December, the whole world has been shook with the notion of what this means for the business sector.
The importance of businesses preparing for Brexit was recently highlighted by a television advert, stressing the point that businesses absolutely must be ready for changes from 1st January 2021. There is a conspiracy theory that this deadline is a distraction. The economies of the world have been thrown into flux over COVID-19, and you might expect that business has been undertaken slightly differently anyway.
But, the fact remains, a full Brexit means a complex break from the EU, and that throws us into the realm of World Trade Organisation rules and regulations. This is speedily becoming less about politics and the rhetoric of in or out, and more a dawning realisation of a new normal – one beyond the new normal that will arrive when COVID-19 and its impacts slow.
Dealing with the impact of Brexit on your business
According to Sage, there are three key points that need to be the highlight of focus when dealing with Brexit and its potential impact on your business.
- Understanding the key impacts
- Identifying areas for further analysis
- Prioritising to prepare for the changes
When making any changes to the way you operate, you should keep these three things in mind. Aside from that, there are several key areas you need to think about when you consider your operations post Brexit.
Taxes & Duties
The rest of the world (in the main) trades under tariffs and, because of a ‘no deal’ Brexit, you will see the UK subscribe to completely new rules on how taxes and duties are paid. We will also have a tariff for trading with the EU, and when they want to trade with us. There will be an increase in costs to send and import your goods if they originate from EU countries. You will need to find out what these are, and factor them into your revenue predictions.
Companies in the UK sometimes employ a workforce from European countries. We’re still negotiating whether EU citizens can continue to work in the UK, and what skills and salary will determine whether they have the right to do that or not, and we still don’t know if UK citizens can work within the EU (and whether those who are already there can keep their roles), so it’s important you remain well read on this subject. Though it may take years to complete the negotiations, your EU resident employees might be concerned, and you should consider potential future complications when you are considering employing.
State aid, including grants and block exemptions
The EU has restrictions on member states and how they use state aid. It is a way of making sure government resources are not used improperly. For now, we will be bound by the EU’s state aid rules, but after we leave, we might adopt a different approach. If you receive state aid, grants, or block exemptions, you might need to further investigate the new rules when they arrive.
Transport and logistics, including fulfilment
This is something that is changing a lot. It’s difficult to keep up to date with what is going on when, but if you transport goods through Europe, you might need to register your trailer differently, and you should use the government’s ‘check an HGV is ready to cross the border’ service to prove your vehicle has the right documents before you try to access another country.
Product safety or eco-compliance
If you package items, you are going to need to make sure the packaging you use is EU compliant. If you label food and drink, you can find more information on this government webpage.
Copyright, trademarks and patents
Whilst copyright law and patents are typically set by individual countries, trademarks are registered in one of three ways, and Brexit will affect each one individually.
Tariffs and supply chain disruptions
If you are buying materials or selling goods, and if your trade is EU wide, the imposition of tariffs and supply chain disruptions might impact your business. You will need to consider that it may cost you more to import or export items you need.
Changes to admin
If you are part of a multinational and you operate throughout the EU, you might see an impact on your internal processes, as there is a further layer of admin you need to complete.
If in doubt, call the experts
If you are confused, it might be a good idea to seek help from an expert. It is vitally important you pay attention to the details to make sure you are not breaking the law, and that there is no disruption to your business. Not only will an expert make sure you have ticked all the boxes, but they will also take time consuming research and tasks off your hands, leaving you to continue generating revenue.
For more information, email email@example.com, or call 0161 491 3933.