With January around the corner, here are some tips for everyone in the self-employed and freelance community to prepare for a deal or no deal brexit.
We’d love to give you a definitive answer. But even writing this in January – at the end of the transition period - the impact Brexit will have on the economy, and therefore all UK businesses, is still hotly debated.
Nevertheless, it’s a new trading landscape for the UK as of now and it’s going to have an impact on all of us, whether or not your business trades with the EU.
How it will hit the five million of you who are freelancers or self-employed will only really be clear over time - it’s going to depend so much on your specific sector and how that’s affected by the terms under which we have left. We know from our survey in 2019 that many of you are worried that it will have more of a negative than a positive impact on your finances – and on business in general.
IPSE, the association for independent professionals and the self-employed, has said that the self-employed often feel the impact of economic changes first because businesses can so easily issue or terminate their contracts.
But, being practical and keeping a positive mindset, do your best to prepare for either scenario - a downturn in your business or a bounceback and increased demand. Whether you felt that Brexit was a good or bad thing, there will inevitably be sectors and businesses that can benefit from the changes, and others that will have to adapt.
If you’re freelance or self-employed, and are in any way doing business with the EU, (you can see what we mean by this in more detail below), then you should already have acted on the Government ads, got their guidance and taken the necessary steps so you can carry on doing business in or with the EU.
What we mean by “doing business with the EU”:
If you want to double-check anything - the Government’s guidance and checker tool for personalised advice is here.
We’d also urge you to sign up for updates from the Government to changes that could affect you in the coming months. There are two easy ways to do it:
All businesses and self-employed people who currently trade with the EU, and want to continue doing so, need to have registered for an EORI number.
You don’t need to do it if you’re a UK-specific business and if you have clients outside the EU then you’ll already have one.
It’s free, it takes just a few minutes to apply but it takes up to three days to process and then there’s a further 48 hours before you can use it to make declarations using the Customs Handling and Export Freight system.
Learn more and apply through the government website.
If you do trade with the EU as a freelancer or self-employed person, getting an EORI number is literally the first step.
All the different actions you may need to take cover areas like changes to customs rules for exporting and importing certain types of goods, changes to VAT, tariff changes, changes to Common Transit and to the regulations concerning moving goods to or through Northern Ireland, travel permits for business travel and visa requirements if you’re employing anyone from the EU.
The Government site asks you a number of specific questions about your travel plans as well as detailed questions about your business. From your answers it creates a personalised plan of every requirement that could affect you and your business - giving you specific advice on each requirement.
There’s no urgent need to do anything – but we really urge you to get up to date and organised with your accounting and reporting so you’re prepared for any changes down the line that could result from the UK starting to pick up rules and regulations previously agreed within the EU.
With lockdowns in place across the country, having an online presence is essential to any business. And, with Brexit in full flight, it's important to note that there have been changes to the types of domains that UK businesses can and cannot hold. Now, you can only hold or retain a .eu domain if:
You can find out more at the UK Gov website. Unfortunately, if you don't meet the criteria the domain will be withdrawn. So, you will have to look for an alternative (possibly .co.uk, .com, .org or even .co) and migrate your website and emails. For those who are eligible, you have until the 31st March to take action and prove your eligibility to your domain registrar.
If you’re VAT-registered and your turnover is above £85,000, you’re already required by HMRC to keep bookkeeping records, and submit returns, digitally.
They’re also going to make it mandatory for all self-employed people who submit a self-assessment tax return in the near future too – so we’d strongly advise you to get that underway sooner rather than later so you’re prepared for this change.
We hope you’ve found this article useful - however, it’s clear that the impact of the new regulations will become more apparent as time goes on and we will continue to update this article with more information as it becomes available.Have any questions? Feel free to message us through the Coconut Bite community.
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