With the Corronavirus pandemic dominating the headlines and topping many small business’ list of concerts, you’d be forgiven for putting Brexit on the back-burner this year. But the UK leaves the EU on the 31st December this year after completing a transition period where little has been achieved due to the pandemic. We take a look at some of the last minute preparations your small business may need to take in this blog.
Believe it or not, we can now count the days until the end of the transition period and we still don’t know whether we’re leaving with or without a deal! As a result many small businesses don’t know exactly what needs to be done to prepair, rather there are grey areas that will need to be addressed once everything is confirmed.
Couple that with the uncertainty over lockdown intensity and duration, and you can quickly see this could well be the most turbulent time that some small businesses will ever face.
Check what preparations you and your business may need to make by completing this questionnaire.
So, what can you do to prepare now, here are a few areas that businesses should be aware of which will likely change fron January onwards:
Employing EU workers
From Jan 2021 there are new immigration rules for recruitment of EU nationals, who will be treated as any international immigrant is treated now. The requirements for a working visa are complex, and if you usually employ from EU nations it is worth getting advice from an immigration expert.
If you regularly employ staff from the EU, your company will need to apply to become an ‘Approved Sponsor’, approval takes about 8 weeks so if you’re looking to employ EU nationals in the new year you need to paply now.
Find out more here.
Data Protection (GDPR)
UK personal data protection is likely to be identical or very closely aligned to the GDPR, so if you’re currently compliant for UK-based data then you should be facing minimal changes, if any. However if you handle the personal data of citizens from the EEC, or if you pass personal data between the UK and EEC you may need to make some changes.
It’s not clear yet whether the UK will be granted a favourable ‘adequacy decision’, which would indicate UK data protection is strongly aligned with the GDPR, and therefore no additional measures between the UK and EEC would be necessary. However this is certainly not guaranteed. British companies should consult the ICO to see what preparations they need to take now.
If you rely on imported goods in your business there are a few things you must be aware of. Firstly significant delays are possible, especially as we still don’t know the deal outcome. It is likely that we’ll see significant delays at the ports in January, so many businesses are increasing stockholdings in the UK to prevent delays.
There may be EU import duties to pay on your goods, similarly if you export to EU customers they might be receiving an unwelcome bill. At this time it’s crucial to keep contact with your EU-based counterparts and be as transparent as possible to avoid unnecessary delays, confusion and frustration, and keep your business running smoothly.
Import VAT requirements will be relaxed at the start of the year, with ‘postponed accounting’ being introduced – this means that instead of paying import VAT upfront as goods arrive into the UK, businesses will be able to account for the import VAT on their VAT returns. However, please be aware there is still a cost to this, albeit a deferred cost. Plan for the increased duties on imports from EU and non-EU countries alike. There is more on import and export VAT here on the ICAEW site.
We will default to the current WTO tariff until individual deals are set up between the UK and other international countries, so be sure to check your import tariff ahead of time.
If you export to the EU and utilise pallets you’ll also need heat treated pallets which can cost a little more, so please consult your pallet partner on this point.
Find out more about import/export here on the Federation of Self Employed & Small Businesses website. There is also some great, detailed information on the ICAEW website here.
Did you know that if your company uses a .eu domain name, but it’s principal place of business is in the UK, you will no longer be able to use this domain name? If this applies to you, get your business a suitable domain name and transfer your website over as a priority.
Travel To EU
It’s not just about the immigration queues at the airport now, you may notice a few changes when it comes to business travel in the EU. Check your insurance, mobile and data plans, any visa costs.
It is not yet known if the currrent reciprocal healthcare agreement will continue, so health insurance for business travel should be strongly considered.
Scams & Fraud
Fraudsters are a big nuisance, particularly for small to medium businesses. And it is expected that a wave of new scams will arrive with the end of the transition period. This is of particular concern because so many businesses are still in the dark about necessary changes without a deal on the table. As the deadline draws closer, the opportunity for fraud increases.
If you receive calls, emails or letters demanding you take action as a result of Brexit remember to do your due diligence. Check the ‘from address’ on emails, does it look legitimate? Fact check what you’re being told.