Brexit

Get you business ready for Brexit – Time is running out!

With a no deal agreement in place, please see below for more information as to how Brexit may impact your business, from imports & exports to VAT & reverse charges.

The transitional period will end on the 1St January 2021 and many businesses are still not prepared for Brexit.

How will importing from the EU after Brexit now there is a no deal?

After Brexit there will be no more intra EU supplies and all goods supplied between the UK and the EU will be exports. The UK will be treated like other non-EU countries and procedures when importing after Brexit from the EU will change. Goods arriving in the UK from the EU will be subject to VAT and potentially customs duty which is accounted for by the importer.

Will the reverse charge still apply after Brexit?

Services supplied outside the UK are generally outside the scope of UK VAT. They will still be subject to the reverse charge after Brexit in the other EU country. EU VAT after Brexit is likely to change and the UK could introduce new VAT rules after Brexit. However, services bought from outside the UK will still be subject to the reverse charge after Brexit.

How can I export to the EU after Brexit?

Exporting to the EU after Brexit will mean that goods being moved to EU member states will become subject to Customs Duty. The customs duty rates are listed in what is known as a “common external tariff”, and the rate depends on the nature of the goods. Traders will need an EU EORI Number for exporting to the EU after Brexit.

How will VAT change after Brexit?

From 1 January 2021, there will be some changes to how to report VAT after Brexit. Brexit implications mean that import VAT can be postponed and it will mean you get an online monthly statement that will show the total import VAT postponed for the previous month which you should include in your VAT Return. Brexit VAT changes of postponed VAT accounting will result in changes to the way you complete the boxes on your VAT Return. You must account for import VAT post Brexit on your VAT Return and include the date that you imported the goods

Will there be a new distance selling threshold between EU and UK? How will the distance sales be treated?

The distance selling threshold in the UK will no longer apply to businesses and sales of goods to EU consumers will be zero rated. UK businesses who are distance selling are advised to review their current arrangements and may need to register for VAT in more EU countries to deal with import VAT post Brexit. Low Value Consignment Relief (LVCR) will be abolished from 2021. There will be new rules for online marketplaces and good values under £135. If goods are sold via online marketplaces (OMP) it is the OMP that will be responsible to collect and account for VAT.

When will I have to do the custom clearance and submit customs declarations after Brexit?

The UK Government says that border controls will be phased in between 1 January 2021 and 1 July 2021. Basic customs clearance after Brexit will apply from 1 January 2021, but for most goods businesses will have up to six months to submit customs declarations and it will be possible to defer duty payments until the customs declaration has been made.

What will be the VAT position between Northern Ireland and Ireland?

As part of the WA, Northern Ireland (NI) will enter a special VAT and customs relationship with the EU.

NI will remain within the UK VAT area, it will continue to use EU rules, including zero-rating for VAT on intra-community supplies to Ireland.

EU VAT on imports to Northern Ireland will be managed by the UK authorities.

Will the Moss scheme still apply? Will I need to register for VAT in the UK?

Businesses will no longer be able to use the UK’s Mini One Stop Shop (MOSS) portal to report and pay VAT via a single return on sales of digital services to consumers in the EU. Businesses who wish to continue to use the MOSS system will need to register for the VAT MOSS non-Union scheme in an EU Member State. This can only be done after the transition period ends. From 1.1.2021 the £8818 threshold will no longer apply for digital services between the UK and EU non-VAT registered customers.

Making a business case for setting up in the UK

The UK is one of the most popular locations for companies to expand to and offers many benefits

International companies locate to the UK because they want to:

Access new or existing customers
Develop new products
Find new suppliers and partners
Do more business in other countries across Europe

Locating a business in the UK can offer many advantages:

Skilled workforce
Funding – grants, loans and other support
Enterprise zones – offer companies incentives to locate businesses in those areas
Good infrastructure

Will my CE certification still be valid after Brexit?

Products exported to the EU will still need to conform to EU regulations and have EU certification. Certification processes can vary, with some goods requiring self-certification, and other goods requiring Notified Bodies to inspect the product.

Certification from a UK Notified Body will no longer be valid in the EU after the Brexit. However, most UK Notified Bodies have set up European subsidiaries to ensure continuity. Check with your Notified Body and find out whether they can offer this service.

New certification marking will be introduced in the UK, called ‘UKCA’. UKCA marking will likely not be necessary immediately, with a grace period instead.

Our start-up services comprise everything you need for getting your business up and running

Business Plans and market entry support services
Advice on choosing a business structure
Registration of the entity

Help with opening a bank account
Tax registrations (Corporation Tax, VAT, PAYE, CIS)
Outsourced accounting and compliance services if required

Help with getting specialist legal advice
Advice on finding office space
Assistance with finding employees

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Starting a business in the UK – Guide for Overseas Companies

How can overseas companies set up a business in the UK?

The three most common ways of establishing a presence in the UK are via:

UK limited company

Branch

Limited Liability Partnership

Are EC Sales Lists still required after Brexit?

EU Businesses do not need to submit EC Sales Lists for sales made after Brexit, which is currently the end of the transition period, 31st December 2020. For any sales made before the 1 January 2021, businesses will have bee given until 21st January 2021 to submit their ESLs.

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What are the Brexit consequences for EU nationals living in the UK?

Any EU nationals that are residing in the UK by the 31st December will still be able to apply under the EU Settlement Scheme until the 30th June 2021. If they have got the settled/pre-settled status, then nothing changes.

Can I still work in the UK if I am an EU national? Do I need a VISA?

If the EU national has a settled/pre-settled status, they will not need a VISA and will be able to continue working in the UK. If the EU national moves to the UK for work after the 1 January 2021, then a VISA is required. Until 1 July 2021, you can continue coming to the UK as a frontier worker using your valid passport or national identity card. You can apply for the frontier worker permit as soon as the scheme is launched.

How do I apply for a frontier worker permit?

On 10 December, the government is expected to launch a frontier worker permit scheme. Can then apply if you have frontier worker status. Applications are free. You can apply online from inside or outside the UK.
From 1 July 2021, you must hold a valid frontier worker permit, as well as your valid passport or national identity card, to enter the UK as a frontier worker.

What about frontier workers? Do I need a visa to continue to work in the UK?

A frontier worker is an EU, EEA or Swiss citizen employed or self-employed in the UK but who lives elsewhere. You can keep your frontier worker status if you are working in the UK by 31 December 2020, but you should apply for a frontier worker permit as soon as possible.

Will employing EU nationals still be possible after Brexit?

It will still be possible to employ EU nationals after Brexit if:

The employee speaks English
The offered job is of a minimum skill level (anything equivalent to A level or above)
The employee’s salary is over a threshold of over £30,000 per year

Employers must also pay a fee per skilled migrant worker they employ through the Skilled Worker and Intra-Company Transfer routes.

How will importing from the EU after Brexit change if there is no deal?

Will my current EORI number still be valid or will I need a new one?

From 1st Jan 2021, a GB EORI number will be required to move goods between the UK and the EU. You may also need one if you move goods to or from Northern Ireland. You will not be able to use an EU EORI number after Brexit to import goods to the UK.

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What Do UK Company Incorporation Services Consist of?

Our company incorporation services will begin by assessing whether starting a company in the UK will best serve the objectives of the overseas business. We will go through the alternative options, advise on the advantages and disadvantages, as opposed to using a different entity type. Assuming incorporating a UK company is the best option, we will advise about the naming process and check the availability of your preferred names. We will assist you with completing the set up questionnaire, which asks for details about the directors and shareholders as well as other information needed for the incorporation process. Choosing a standard industry classification code (SIC code), that identifies the industry sector that the business will be operating in, is often very confusing and we will guide you through the long list of options. We can also provide a registered office address for your company, if you don’t have a UK address.

Frequently Asked Questions

Can I incorporate a UK company if my business is located in USA?

An overseas business can set up a UK entity and it does not need to have an office or staff in the UK to do so. There will be different tax implications if that is the case, as oppose to when the company has a permanent establishment in the UK, with a local office and employees in the UK. The facts are often not totally clear cut and need careful consideration to ensure taxes are declared correctly, therefore it is always wise to take professional advice on these matters.
What are the steps for EU residents when incorporating a UK company?

The steps are the same for all foreign persons and businesses who want to incorporate a UK company.
Can I incorporate company online?

Online incorporation can be done in most cases, but not all. We do not advise that it is done without taking advice about the implications of incorporating a company and receiving confirmation that this entity type will achieve the business’ objectives. You should be familiar with the UK incorporation process and have taken advice on how to structure the new entity before embarking on an online company registration yourself.
Can Axada help with incorporating a company online in the UK?

Yes, and as part of our full package of UK company incorporation services, we may in the final step register the company online. Online registration may not be suitable for all companies and in these cases we will register the company via other means.
If I use the cheapest incorporation agents, what are my risks?

Using these services, you will simply be sent a form to complete which will form the basis for entering the information on the agents bulk formation system. Normally, there is no guidance provided and cheap formation services will not offer any advice on whether incorporating a limited company will be the best option to achieve your objectives.
How long does it take to incorporate a business in the UK?

We can normally quote a timescale of 1-2 days after we have received all the information from you.
Can you help with UK LLP Incorporation?

Yes, we can also offer UK LLP incorporation services.
Are there any annual compliance requirements when I register a UK company?

There are a number of annual compliance requirements once a company is registered and we can take care of all of these annual compliance requirements for UK companies, freeing up more time for our clients to concentrate on managing their businesses.

Annual statutory accounts must be prepared and filed at Companies House.

Every year the business must complete a Confirmation Statement (formerly called Annual Return).

Since 6th April 2016 a persons with significant control register (PSC register) must be held and kept up to date. This identifies all persons that have significant control or ownership.

All formal changes, such as a change of director, shareholder or a change of address must be registered at Companies House and specific forms need to be completed either online or in hard copy.

Recording minutes of meetings is very important as this records important decisions and resolutions made by the directors. Even though the keeping of minutes of meetings is a legal requirement it is often neglected by many companies and this can affect due diligence outcome in the event of a sale of the business.