Preparing for a No Deal Brexit
17th June 2019 by Fiona Hotston Moore
At this point it is quite possible the UK will leave the EU on 31 October 2019 without a deal. To avoid a No Deal Brexit will require either an agreement on the terms of the exit or an extension to be granted.
Many businesses will have started to review the impact of a No Deal Brexit earlier in the year but at this point all organisations will need to review or revisit their No Deal plans.
The impact on your business will depend on a number of factors. These include:
- the extent to which your business buys or sells goods or services with customers or suppliers in other EU countries
- does your business employ EU workers
If you are impacted, here are some practical steps to be considered:
- Investigate the impact of regulatory changes on how you sell into the EU from the UK and also how local UK regulation changes might impact buying goods and services from EU countries and bringing them into the UK.
- Opening an overseas bank account in an EU country. Undertaking banking transactions with EU entities may become more complex so having an EU bank account could avoid cashflow difficulties. Opening bank accounts is increasingly challenging so this should be considered now.
- Setting up a company in an EU country. Incorporation is generally quick. Ireland is a popular location for UK businesses looking to acquire a legal presence in the EU post Brexit.
- Increase stock levels held in EU locations. Increasing stock held locally could avoid border delays in servicing customers in EU countries.
- Supporting and assisting EU workers. Should you provide legal assistance to affected employees to allow them to check their immigration status? Will reduced immigration require you to look at other avenues to resource your business such as apprenticeships?
- Review plans to pay or receive dividends, interest and royalties as post Brexit withholding taxes may be levied.
- Look at the likely changes to Customs Duty for the movement of goods. Customs Warehouses may be required.
- Apply for an importer reference number (EORI) and Transitional Simplified Procedures (TSP). Currently businesses do not need to “import” goods into the UK from the EU. This would change in a No Deal Brexit and businesses may wish to get the approvals in place now to avoid problems later.
In conclusion we are now at the point when a No Deal Brexit is a realistic outcome so businesses must consider the implications and, if impacted, take steps now to prepare.
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