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What could Brexit mean for you and your business?

Read our tips on how your business could be impacted by Brexit and how we could support.

The UK’s departure from the European Union is a significant change to our economy, trading and financial arrangements.

It could impact you and your business, if it hasn’t already – and there might be steps you need to take over the coming months.

We’ve brought together key points about the deal that was agreed between the UK and the EU.

You’ll also find industry perspectives on what these could mean for your banking and financial plans from our Business Banking experts.

Plus, we’ve highlighted ways that you can prepare for the end of the transition period in December 2020.

If you would like to discuss how you could be affected, contact our Business Banking Team.

What do I need to know about the Withdrawal Agreement?

The Withdrawal Agreement means the UK has now entered into what’s called the transition period, which will last until 31 December 2020. During this time, the UK will negotiate a new trade agreement with the EU to determine our long-term relationship.

If no agreement has been reached, the transition period could end without a new trade deal in place – and the UK could revert to World Trade Organisation rules covering trade with EU countries.

The government has currently ruled out extending the existing transition period.

In the meantime, the transition period actually means very little has changed. While the UK is no longer a member of the EU, it continues to abide by its rules until the end of 2020, including trade and the free movement of people between member states.

This gives you more time to get on the front foot and plan ahead. The Withdrawal Agreement establishes some important principles that businesses must understand and be ready for.

If your company employs EU workers, the new Brexit deal means they have until 30 June 2021 to apply for settled status – effectively permission to continue living in the UK – as long as they are living in the country by 3 December 2020. Find out more about how employers can support EU staff.

What if I trade with customers in Northern Ireland?

Any SME that does business with Northern Ireland should study the Withdrawal Agreement particularly carefully, as special provisions apply to trade and borders.

Under the agreement, the whole of the UK – including Northern Ireland – will be a single customs territory and apply the same tariffs on imports. At the same time, Northern Ireland alone will continue to be part of the EU’s customs rules for trade with the Republic of Ireland, with no tariffs or restrictions on goods crossing the border in either direction.

While this means there is no need for a hard border on the island of Ireland, it could mean some changes. This is because the EU reserves the right to charge tariffs on certain goods moving into the EU from other parts of the UK.

These will apply to any goods deemed to be “at risk” of moving into the EU after crossing into Northern Ireland from the mainland. In essence, it will require customs checks and controls on goods crossing from the UK to Northern Ireland.

For more information, visit gov.uk

‘Businesses need to plan ahead’

Ian Workman, Co-Head SME UK at Barclays Business Banking, says:

“Over the coming months, the UK will remain a member of the EEA, single market and customs union, but the UK will leave this transition period at the end of 2020, so it’s important to plan ahead and take some time to understand the impact on your business.

“Importing and exporting will clearly be one of the biggest areas impacted in one shape or another. At Barclays we have a dedicated team of specialist client solutions colleagues who are experts in supporting trading internationally and have very close links to the Department for International Trade and UK government.

“We offer free telephone reviews to help you manage your imports and exports efficiently and can connect you with other local experts. 

“The landscape will evolve during the transition period and whilst we may not have all the answers, we will be keeping a close eye on developments so we can support in the best way.”

Mark Suthern, Managing Director, National Head of Agriculture at Barclays, says:

“It’s important for farmers across the country, including in Northern Ireland, to prepare for changes following Brexit and the end of the transition period.

“But Brexit isn’t the only shake-up that farmers need to prepare for. The Agriculture Bill will see major changes to the support that farmers receive from the government.

“Amid this change, businesses need to think about how they invest and grow for the future. The farming sector is extremely resilient and innovative, and those who work in it are devoted to the land and are extremely hard working. 

“We have a long history of working with the agriculture sector, with local managers who work with local communities and local farmers, so we can really understand the challengers they are facing.”

Essential steps to prepare for the end of the transition period in December 2020

1. Assess your exposures and vulnerabilities

Make sure you have documented and analysed every element of your trade with the EU and started to consider how this might be affected at the end of the transition period.

It’s also worth bearing in mind that as a result of changes to our relationship with the EU, our trading relationships with other countries might change after Brexit as well. It’s important to consider how your business might be affected.

Our Brexit hub can help you deal with the uncertainty surrounding Britain’s departure from the EU.

2. Apply for an EORI number to continue to move goods into or out of the EU (including the UK)

When UK businesses buy and sell goods in the EU today, they’re not treated as imports or exports since the Customs Union means there are no trade borders with other member states.

This will no longer be the case at the end of the transition period and you’ll need a reference number to continue trading – an Economic Operator Registration and Identification (EORI) number. Check if you are registered now.

If you import goods from the EU, you can also register for and use Transitional Simplified Procedures (TSP), to get extra time to send in your customs documentation. You’ll need an EORI number, starting with GB, to apply for TSP.

If you import goods from the EU, you should also familiarise yourself with VAT rules and check the duty you’ll have to pay on items you bring in to the UK.

You can find more information on www.gov.uk/transition.

3. Work out your workforce’s needs

If your business employs EU workers, check if they have applied for settled status or what their plans are. You could also see if they need support to complete their application.

Thinking ahead to future employees, make sure you familiarise yourself with the new rules and consider if you need to change your employment approach to meet the needs of your business.

Bear in mind too that similar restrictions are likely to apply to any UK residents you may employ in another EU member state. Consider if any new regulations apply to their travel between the EU and UK, such as visa requirements.

4. What happens at the end of the transition period?

If a free trade agreement has not been agreed at the end of the transition period, the UK will leave the EU with no trade deal in place. Under this scenario, it will revert to WTO rules for trading with EU member states.

Keep the ‘No deal’ planning that your business completed before the Withdrawal Agreement announced and make sure it is updated. If you didn’t do any such planning, start thinking about the various scenario so you can plan ahead. Visit our Brexit hub.

How Barclays can help

We have different types of support available for you and your business, including the Barclays £14bn SME lending fund to boost expansion, investment and growth.

Short-term borrowing options such as overdrafts, credit cards and invoice finance can help you to bridge a gap in working capital.

Barclays offers unsecured overdrafts up to £50,000, and secured overdrafts for larger amounts. If you have a pre-assessed limit with us or have online or app access, you can apply in six simple steps and get an instant decision. If approved, funds will usually be in your account in 24 hours. Lending is subject to application, financial circumstances and borrowing history.

Barclays can also provide access to trade instruments such as BGIs, Letters of Credit and Documentary Collections that customers may be asked for, to facilitate both EU and Non EU trade.

If you would like to get help considering funding, trade or cashflow options, call our Business Lending team on 0333 202 7430 1.

Talk to your relationship contact to find out more about our Brexit clinics and other initiatives. Contact us to find out more on 0345 605 2345 2.

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