IS YOUR BUSINESS READY FOR BREXIT?Dec 03 2020
The UK left the European Union on the 31st of January 2020 and the transition period ends on the 31st of December 2020.
The Covid-19 pandemic has dominated the news headlines this year, but Brexit is still progressing. During the transition period, the UK remains in both the EU customs union and single market. Until the end of the transition period (31st of December 2020), most things stay pretty much the same. So, what do businesses need to think about in terms of UK-EU trade from the 1st January?
Brexit could affect your business in many ways. For example, businesses that import or export goods between the UK and the EU will need to consider what operational changes they will need to make in advance of January 1st. The UK Government has set up a helpful webpage which includes useful guides and checklists which you can access here.
A new customs regime will come into force on the 1st of January 2021. Hopefully, a trade deal can be agreed by then, as the final arrangements are still not clear.
UK businesses that trade with countries outside the European Union will already be familiar with an Economic Operation Registration Identification (EORI) number. From the 1st of January, British companies will not be able to trade with the EU without an EORI. In the absence of an EORI number, goods could be held up at ports.
Also, non-compliant businesses won’t be able to take advantage of any special measures such as deferred tariff payments that look set to be introduced to smooth the flow of trade.
Another consideration for businesses is taxation. HMRC offers guidance on its website for the future treatment of payments between UK companies and EU member states. As ever, tax can be a complicated subject and it is often best to invest in some tax advice from an expert.
Finally, businesses that trade with the EU may need to consider any additional regulatory obligations that come about as a result of Brexit. As things currently stand, there are a lot of unanswered questions as we still don’t know if a last-minute trade deal will be agreed between the UK and the EU. Either way, it’s worth keeping an eye on the gov.uk website for any additional guidance or updates.