TT275: Brexit – Deal or No Deal
Whilst uncertainty remains as to what Brexit will mean for UK businesses post March 2019, businesses that buy or sell to the EU should plan for the risks and opportunities that may arise.
Whatever the outcome of the negotiations and UK/EU trade deal, Barnes Roffe can provide advice and support in the following areas: –
Supporting the business locally in the EU and beyond
We are a key member of the International Practice Group (IPG), a global association of independent Lawyers, Accountants and Tax advisers, enabling us to help guide you through the different regulatory and compliance requirements of new jurisdictions to provide greater cross border certainty post Brexit whether you are planning expansion into the EU or beyond, or to ensure existing continuity.
Areas for consideration could include:
- Navigating complex customs clearance procedures for exports into the EU;
- Dealing with refunds of local EU VAT;
- Reviewing contracts with EU suppliers and customers to ensure commercial protection;
- Ensuring products exported to the EU comply with local technical compliance standards;
- Ensuring HR compliance for taking on EU nationals post Brexit under planned transitional rules.
Financing the business
Brexit could mean additional direct costs, for example tariffs, but it could also mean additional unforeseen costs, for example more complex customs clearance procedures for imports from the EU could mean that businesses need to hold more stock.
Cashflow projections will help identify the likely working capital requirements but can also help identify the impact of Brexit by focusing on sensitivity in the supply chain (additional costs or alternative suppliers) or customer chain, for example a profitable customer account could become unprofitable with additional export costs, and how much additional finance could be required in addition to the businesses current facilities or other protection such as export credit insurance.
Planning early and engaging with your bank or other financial lenders will minimise any short-term financial exposure.
Structuring of the business
Brexit could bring unexpected risks to labour supply, additional costs, market uncertainty.
It therefore may be sensible to consider restructuring a business operationally to ring-fence potential liabilities separately from valuable assets such as property or surplus cash. Reorganising the business may also provide clarity as to the business objectives, for example growth in the EU may be considered using a permanent establishment as a more viable route to direct export and help enhance EU customer relationships. Tax efficiency, for example to take advantage of certain reliefs or to mitigate the effect of additional customs costs. To provide flexibility for future growth or exit opportunities.
At the very least consideration of the above may help identify opportunities as even a hard-Brexit will mean the same risks will be faced by EU businesses such that UK businesses could provide a solution.Talk to Barnes Roffe today