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Are You Ready for Brexit?

Plenty of changes are just around the corner for businesses from 1 January 2021. The UK’s formal exit from the European Union means that businesses must do what they can to prepare for the upcoming changes. We have put together a quick guide on some of the things you need to know about.

This article contains:

  • Check your existing contracts
  • Employing non-British nationals
  • Check your supply chain
  • Check insurance policy coverage
  • Do you have an EORI number?
  • Are you ready for VAT changes?

Check your existing contracts

If you have any supplier, customer or employee contracts that refer to the EU, you will need to check whether these will remain legal after 1 January. It’s wise to spend some time checking over the terms and conditions of any agreements you have made in the past. If you’re unsure about the language or legality of contracts, it’s best to consult legal advice just to be sure.

Employing non-British nationals

For those who employ non-British nationals, one of the crucial things you will need to check is whether their contracts and work statuses are still valid in January. Non-British nationals may need a visa to work in the UK, so you will need to make sure all that paperwork is in order as soon as possible. It may also mean you have to revise employee contracts where necessary.

Check your supply chain

If you import and export goods in and out of the UK, Brexit is very likely to affect this. The main way you could be affected is by changes to tariffs.

Tariffs could increase the cost of exporting or importing which can have a huge effect on your business. In terms of your supply chain, you will need to check whether your EU suppliers are still willing to do business with the UK. Some suppliers may avoid trading with the UK altogether if it costs more.

If you haven’t already, spend some time speaking with your current suppliers to see if you can come to an arrangement. Alternatively, it may be time to start talking to local vendors and suppliers.

Check insurance policy coverage

Another thing you will need to check is your insurance policies as these could also be affected. Leaving the EU could mean that some agreements are invalid. The last thing you want to do is find this out when you try to make a claim.

To be sure your insurance is still valid, you will need to check the terms and conditions or speak with your provider.

Do you have an EORI number?

From 1 January 2021, you will need an EORI number to trade between Britain and other countries.

You may already have an EORI number but the rules have changed slightly. From 1 January, businesses must ensure their EORI number starts with ‘GB’ for it to remain valid after 1 January. If yours does not start with GB, you will need to apply for a new one as soon as possible.

Are you ready for VAT changes?

VAT is another area which may be affected by Brexit. If you are VAT-registered, you may have to register in other EU countries to do business with them. This will depend on those countries’ individual laws and will require some research.

It’s not entirely clear yet how VAT will change after 1 January so it’s a good idea to keep in close contact with your accountant. Your accountant will be best placed to advise you on any changes coming your way.

While many of the above may not affect you, it’s important to check all your documentation, contracts and supplier agreements as soon as possible. The sooner you are aware of what needs to be changed or renegotiated, the better prepared you will be in January.