Have You Prepared Your Business For Brexit?
You may have been preparing your business for Brexit for the past four years now, but we are finally coming to an agreement that will create significant change to your business. From 1st January 2021, these significant changes will particularly affect your business if you are going to be doing business with EU companies, importing goods to and from the UK, travelling to the EU and employing EU citizens.
If your business fits into any of these criteria, we highly recommend you put a plan in place immediately for when Brexit happens on 1st January 2021. So, what business measures should you be considering when preparing your business for Brexit? We have put together a few significant factors that could be impacted when the Brexit plans have been finalised.
Supply Chain Arrangements
If you are working with a supply chain, we suggest that you contact other businesses in your supply chain to make future arrangements for during the transition and after Brexit. This refers specifically to those businesses that are going to be importing and exporting goods to and from the UK. The main change in your supply chain you should look out for when preparing your business for Brexit is the prediction of increased tariffs and import/export costs. For example, customs duty. This major change would cause an increase in the costs of goods for customers which means your current supply chain might decide they do not want to trade with the UK any longer. Therefore, when preparing your business for Brexit, you should consider a plan B when it comes to supplier arrangements.
Supplier & Customer Contracts
Even if you are lucky enough to keep your current contract with your supplier post-Brexit, the new rules and regulations might not necessarily be the same. Therefore, you should consider checking if the terms and conditions of your contract with your supplier are going to be completely legal from 1st January 2021. This also applies to businesses that have new suppliers as rules and regulations can change at any point.
As well as supply chain agreements, you should also check the terms and conditions in your customer contracts as these can also change if you are trading with customers within the EU. If you are unsure of anything contractual within your business, you may find you need to seek legal advice so your contracts can be reviewed.
Employee Contracts
Once you have reviewed the terms and conditions in your supplier and customer contracts, you should consider doing the same with your employee’s contracts to ensure they are valid. Some employee contracts may need renewing, especially if any of your employees work outside of the UK or are non-British nationals working in the UK. Renewing non-British national employee contracts will require the correct paperwork that is essential when preparing your business for Brexit. For example, they might need a visa to legally work in the UK post-Brexit which will require paperwork that complies with UK legislation. On top of this, non-British employees working in the UK might also need to apply to the EU Settlement Scheme in order to continue living in the UK. You can find out more information on the EU Settlement Scheme here.
Insurance Policies
Another factor you should consider reviewing when preparing your business for Brexit is insurance policies. Your current insurance policy might also not be valid from 1st January 2021 which means you will need to renegotiate your current insurance policy and possibly invest in a new policy in concordance with the changes post-Brexit.
VAT
One major change that may occur post-Brexit is a change to VAT which could cause some implications. So, when preparing your business for Brexit, you will want to consider whether you will need to change the VAT rate of any of your products or services. You might also need to register in other EU countries.
When it comes to VAT and Brexit, it’s complex, and it’s currently unclear as to what the final outcome will be so it’s important to prepare as much as possible.
UK Border
When preparing your business for Brexit, you might need to prepare for transportation delays as changes will be made to the UK border during the transition. For example, ensuring you have enough stock in case of stock-outs and to avoid cash flow issues.
You will also need to ensure you have valid trading and transport licenses if you are planning on travelling by road across the UK border. This includes needing an EORI number which will allow you to move goods between the UK and countries not part of the EU. This also includes when moving goods to and from Northern Ireland. An EORI number is what will ensure HMRC can clear your goods so you can avoid storage fees and delays. You can find out more about EORI numbers here.
Business Communication
The final major factor on our list to consider when preparing your business for Brexit is checking whether your network provider will still provide your existing coverage. Post-Brexit is likely to cause restrictions on data, meaning that network providers may make changes to their data roaming coverage. We consider that you contact your phone network provider as soon as possible to find out the possible changes post-Brexit.
Financial Guidance When Preparing Your Business For Brexit
Do you need to plan your business for Brexit and are not sure where to start or need extra guidance? At Stonehouse Accountants, we are able to assist you with the financial queries you may have, such as cash flow support and how to deal with the VAT implications of Brexit. For more information, feel free to contact our accounting team on 01733 265888 or contact us here.
You can also keep up to date with the latest Brexit transition news here.