Now that the UK has left the EU and new rules have come into place as of 1st January, it is important to have a plan to make sure your business is ready for Brexit and put it in the best position possible. Below we have listed some of the key things you need to consider now that the UK has left the EU.
What threats do small businesses need to consider?
Changes to immigration rules
Businesses that rely on skilled migrant labour from the EU will need to consider new rules that have come into place. As of 1st January 2021, EU citizens moving to the UK will need a visa. To get this they will need to show they have a job offer from an approved employer sponsor. If your business recruits from the EU, you will need to apply to become an approved sponsor.
Review your supply chain
Reviewing your supply chain should be a top priority. You should find out the plan of all intermediaries that your business relies on to ensure continuity of service. As a business owner, you should consider every step of the chain and how it could affect you.
Make a list of all the tariffs your supply is currently exposed to, and make sure you are aware of how these have changed after Brexit. Consult the UK-EU Trade and Cooperation Agreement for more information.
Prepare for changes to customs, excise, and VAT
Importing and exporting will become more complex now that the UK has left the EU. Whether you trade only with businesses within the EU, or with others from the rest of the world, you will need to review the possible changes you will face.
You should already have your EORI (Economic Operator Registration and Identification) number (starting with ‘GB’), as you will need this for importing and exporting. Goods may also need export licenses or certificates. The government has released preparation checklists for EU-only traders and traders with the EU and/or the rest of the world, so make sure you are up to date on the latest requirements.
If you import goods from anywhere outside of the UK for your business, you can use postposed VAT accounting to avoid the requirement to pay import VAT immediately. With this, you will need to declare the import VAT on your tax return.
You will not need authorisation from HMRC to use this method, but you will need your EORI & VAT number on the customs declarations. However, Goods under the value of £135 will not attract import VAT and VAT will be applied at the point of sale by the seller.
Investigate any sector-specific changes
One of the most important steps is doing your research. Spend time learning about the regulatory changes that could affect your sector. Some minor amendments have already been made – check the Government’s updated Health and Safety Regulations to learn more.
Access to Finance
Business owners may have to pay a higher price for credit after the exit from the EU and there may be higher interest rates.
Check your travel requirements
A final point to consider is travel between the UK and the EU. If you or your staff members travel to the Continent for work, you will need to find out how the regulation will change and plan ahead. British passport holders will need to have 6 months remaining validity on their passports. To find out more, read the rules for travelling to the EU after Brexit.
Want some more guidance?
Keep up to date on the latest Brexit news and continue to make sure you are aware and compliant with all the new rules and regulations following Brexit.
If you need any more advice on preparing your SME for Brexit, please get in touch and we will be happy to help.