Brexit readiness: are you prepared?
Whatever the size of your business, you should prepare your supply chains, workforce, VAT registrations, processes and cashflow. On this page, you will find a comprehensive checklist of 10 actions that will help you prepare your business in readiness for Brexit. The list is based on our experience of helping clients prepare and advice from the government. Most of the actions will put your business in a better position to succeed in uncertain times.
The government has also released an online tool to help you, your family and your business prepare now. We would advise you to use the tool as well as using the checklist below.
These are 10 immediate actions that will help you prepare your business:
1. Make cross border cash payments before the exit date
If withholding tax (WHT) is likely to be payable on cross-border payments within your group after Brexit, consider bringing forward dividend, loan interest/capital payments and royalty payments to benefit from existing rules. Check out the WHT for different EU countries using our online tool.
2. Make VAT reclaims on expenses under 8th directive
Tax authorities are not keen on repaying VAT but there is an established online mechanism for reclaiming VAT on business expenses you incur within the EU. It is likely that UK businesses will only be able to use a paper-based 13th Directive process which means refunds can take much longer. Therefore, make claims now to limit the hit to your cashflow.
3. Know your customs duty rates
Confirm what duty tariff you will be paying on your trading goods: some tariff rates will go up but others will go down under a temporary new UK tariff. As well as planning for the impact on you imports, don’t forget that UK businesses currently benefit from the EU’s trade agreements with many countries so your exports may become more expensive to some customers.
4. Protect your cashflow from customs duty and import VAT
Customs simplifications such as Customs Warehousing, Transitional Simplified Procedures and Inward Processing Relief can help protect your cashflow from short term customs duty and VAT charges so putting them in place now could save you time and money.
5. Ensure you will get the paperwork right
Check that your systems are set up to handle the new VAT requirements and customs arrangements and make sure your teams have been trained on what they need to do. The government recently made grants of up to 100% of the cost of training for employees on the new customs arrangements, up to a limit of £2250 for each course. No announcement has yet been made about this grant reopening but the need for training remains.
6. Check your data transfer and protection obligations
Check what restrictions there will be on transferring data across borders and put new policies in place to prevent potentially expensive breaches of rules in EU countries. You may need to change your contract terms to comply. Read the government guidance.
7. Adjust your contract terms
Where your post-Brexit trade will incur additional duty, administrative costs for transport or other costs, you should review your terms of businesses with customers. Whether or not you choose to absorb these costs, it is vital to communicate any changes to your customers so that there are no unpleasant surprises.
8. Day One trading in the EU
Check that you have the licences/permits/approvals you need in all the other EU states in which you operate so that you can carry on trading as you do now. For example, are local VAT registrations needed? Should your product labelling change? Are you set up to make any new tariff payments needed? HMRC’s ‘Get ready for Brexit’ information service provides a wide range of information on the licences you may need.
9. Secure your staff here and in the EU
Check if your UK staff that are based in the EU will be able to work – will they need a local work visa? For EU staff based in the UK, check that they have applied for settled status or pre-settled status in the UK and understand the recently announced transitional arrangements.
10. Stock up to help manage transport delays
There could be delays at UK borders. If you import or export – getting advance supplies in place now will ensure that you can maintain sales..