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12 Steps to Prepare your Business for Brexit

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1. Complete a Cashflow Forecast

The economic consequences of Brexit are unclear and will depend on the free trade agreements that the UK can negotiate with the EU and other key trading partners.  These may not be fully in place when the transition period ends (31st December 2020).  Businesses, therefore, need to plan ahead and think about how you could deal with further economic uncertainty.

A cash flow forecasting template can help you plan ahead. Click here to use Armstrong Watson’s free tool

Importing or Exporting Goods

2. Make sure the classification of your goods (tariff /commodity code) are correct

If you source your raw materials from outside the UK, what are the cost and tariff implications?

If you source your raw materials in the UK, check with your supply chain to see if they are reliant on suppliers from outside the UK as this could impact you indirectly.

Where do you sell your goods?  If overseas, what are the implications for tariffs, pricing and shipping?

3. Check out commodity codes, duty and VAT rates

Use the government’s Trade Tariff tool to look up commodity codes, duty and VAT rates.

Find out how to contact HMRC in order to get help with a commodity code and what information you will need to send them.

4. Ask HMRC for help to classify your goods

HMRC can help you classify your goods. Click here to find out how to ask HMRC for help to classify your goods or you can apply for a binding tariff information decision on the commodity code to use for your goods. 

Find out how to apply here: Apply for a Binding Tariff Information decision.

5.  Ensure your company is registered for both imports and exports

From 1 January 2021, you will need an EORI number to move goods between the UK and the EU. An EU EORI number is required if your business will be making customs declarations or getting a customs decision in the EU. Get this from the customs authority in the EU country where you submit your first declaration or request your first decision.

It’s advisable to apply for your EORI in advance as it can take up to a week to get one. If you use a post or parcel company, they will tell you if you need an EORI number. https://www.gov.uk/eori

If you already have an EORI number – Check it!

From 1st January you will need an EORI number that starts with GB to move goods to or from the UK. Check your EORI number and ensure you apply for a new one if yours does not start with GB. https://www.gov.uk/eori

6. Prepare for new customs paperwork

Regardless of whether a deal is reached between the UK & EU, import and export customs declarations with be required for the movement of goods as of 1st January 2021 and it is estimated that the number of customs declarations will increase from 50 million to 200 million.

Exporters are urged to speak with their customs broker or import-export agent who acts on their behalf to secure the service they need beyond the 31st December or look at setting up your business to make declarations internally.

Find out more here: Customs declarations for goods you bring or receive into the UK or EU

HMRC has made funding of £50 million available to enhance its Customs Grant Scheme and organisations are able to apply for funding to reimburse costs associated with increasing capacity and enhancing your ability to complete customs declarations. Click here for further information about the Customs Grant Scheme.

7. Check the new UK tariff for imported goods

From the 1st January 2021, the UK will apply a UK-specific tariff to imported goods. 

This UK Global Tariff (UKGT) will replace the EU’s Common External Tariff, which applies until 31st December 2020.

You can check the tariffs that will apply to goods you import when the UK Global Tariff takes effect on the 1st January 2021:

Find out more here: Check UK trade tariffs from 1 January 2021

8. Check Taxes and Insurance

Brexit will impact on a number of areas including import VAT, insurance and VAT registration in the EU. Check the detailed HMRC, ABI and UK Government guidance to see what steps you need to take.

The Chamber of Commerce has produced a very helpful guide and checklist – covering this plus many more areas.

Download here:https://www.britishchambers.org.uk/page/post-transition-brexit-checklist

9. Consider Data protection and GDPR

After the transition period ends on 31 December 2020 the EU GDPR will no longer be law in the UK. However, as the UK government intends to write the GDPR into UK law, from all practical perspectives, GDPR will continue to apply.

This means UK organisations and individuals that process or transfer the personal data of EU-27 citizens from the EU to the UK may need to take action to continue the free flow of data from the EU to the UK and guarantee the protection of EU data subjects. The action required will vary according to whether there is a deal (as set out in any withdrawal agreement) or no deal.

The Information Commissioner’s Office (ICO) has published a checklist of six steps that businesses can take now to start preparing for data protection compliance in the event of no-deal.

To view the checklist here: https://ico.org.uk/for-organisations/data-protection-at-the-end-of-the-transition-period/

10. Protect your Intellectual Property

At the current time, it is unclear whether trademarks registered in the EU would be applicable to the UK in the future. 

If you own any intellectual property rights, check with your solicitor or IP adviser to ensure you will be protected from 1st January 2021.

11. Review all your contracts and terms.

Conduct a review of all your contracts as some of the terms in existing contracts may no longer be relevant post-Brexit or may raise legal or practical questions in the future, for example, if your contracts make reference to the UK being a member state of the EU or rely on EU regulation, they may need revising.

12. Consider how Brexit will impact on your workforce

Brexit impacts on your workforce in a number of ways, including: