Originally written by Timothy Adler on Small Business
Only one fifth (21pc) of small businesses exposed to Brexit have prepared for the UK leaving without a deal.
The average cost to each company preparing for Brexit has climbed to £3,000, according to the first-ever survey of small business no-deal planning.
More than one third of the over 1,000 companies that completed a Federation of Small Businesses (FSB) survey said that Brexit had already either temporarily or permanently dented profitability.
See also: GDPR and Brexit – 5 steps your small business can take
A similar number said they have had to stockpile before the expected October 31 EU exit date, further tying up funds.
The FSB, which has 165,000 members with an average of seven employees, says that almost 40pc of small businesses would be badly affected by a no-deal departure.
Two thirds of small businesses say they cannot prepare because they don’t know exactly what to prepare for. Many small business owners complain they do not have enough sector-specific information over trading and tariffs, or what kind of Brexit will become law, to be able to plan.
Mike Cherry, FSB national chairman, has called on the Government to issue no-deal preparation vouchers worth up to £3,000 to cover
Tag Archive for Brexit
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GDPR and Brexit – 5 steps your small business can take
by Ian Osborne • • 0 Comments
Originally written by Ian Osborne on Small Business
Whatever side of the Brexit debate you sit on, it is becoming increasingly likely that the UK will no longer be part of the EU from the end of October.
This presents an array of challenges – and arguably opportunities – for small and medium-sized enterprises (SMEs).
However, one key aspect that business leaders must be aware of is GDPR and Brexit and how leaving the EU will affect their operations in terms of data security.
See also: GDPR one year on: what fines have been issued so far?
What the government says you should do
Guidance from the Information Commissioner’s Office (ICO) has confirmed that whether we leave with EU with or without a deal, most of the data protection rules affecting SMEs will remain the same.
The good news is that UK businesses that comply with GDPR and have no contacts or customers in the EEA (the EEA is the EU plus Iceland, Norway and Liechtenstein) don’t need to do much more to prepare for data protection after Brexit.
What if you receive data from Europe?
However, UK businesses that receive personal data from contacts within the EEA must take additional steps to ensure they are fully compliant after
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Brexit blamed for sharp fall in the number of UK start-ups
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
The number of new UK start-up businesses saw a sharp fall last year, with researchers blaming the economic uncertainty caused by Brexit.
These figures come from the Enterprise Research Centre, a research institute made up of several universities. It recorded a drop from 325,900 to 284,000 (12.9pc) in its annual UK Local Growth Dashboard report, which looks at a range of metrics charting the growth of SMEs.
Northern Ireland saw one of the biggest drops overall at around 15pc, even though it’s had strong start-up growth in recent years. Swindon and Wiltshire saw the biggest drops in England with 45pc fewer start-ups than in 2017.
It’s not all gloom, though. Three areas actually saw an increase in start-ups – the north of Northern Ireland (+2.6pc), Liverpool (+2.8pc) and Worcestershire (+9.2pc).
Mark Hart, ERC deputy director and professor of small business and entrepreneurship at Aston Business School, said:
“Budding entrepreneurs are clearly holding their breath waiting for some clarity about the outcome of Brexit, but if the trend continues we’ll see fewer jobs created by dynamic young firms.
He adds that, even though established firms are still growing successfully in many parts of the country, it’s frustrating that productivity growth
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How to prepare your small business for a no-deal Brexit
by Giles Dixon • • 0 Comments
Originally written by Giles Dixon on Small Business
The new prime minister is preparing for a no-deal Brexit on October 31. What does this mean for your small business and how can they survive it?
If you are trading between the UK and the EU, there could be a lot of disruption in October, whether we leave the EU with or without a deal. The situation in some ways is similar to force majeure – an unforeseen event which can cause disruption and damage. But until it happens, you won’t know how badly it will affect your business.
If you are an agent or distributor of a company in the EU or you regularly trade with companies in Europe (or vice versa), you need to think about the repercussions which a hard Brexit might have on your business. The impact could be practical – e.g. do you need to pre-purchase goods to avoid the risk of border delays after October 2019? Or they could affect pricing and profit – e.g. the risk of new tariffs.
Read: Government mulls small business funds to limit impact of no-deal Brexit
It is also important for businesses dealing with the EU to realise that whatever happens on October 31,
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Government mulls small business funds to limit impact of no-deal Brexit
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
The Government is mulling setting up funds to ensure that small and medium-sized businesses have enough access to credit to weather a no-deal Brexit.
Business secretary Andrea Leadsom; Michael Gove, the minister in charge of no-deal preparations; and City minister John Glen are expected to meet senior bankers in Westminster on Thursday to discuss limiting the impact of a hard Brexit on small businesses, according to the Financial Times.
Read: 70% of businesses put investment on hold because of Brexit uncertainty
The Government is concerned about banks cutting lending to small business after the UK is due to leave the EU on October 31, according to one person briefed on the meeting agenda.
However, lenders are pushing for the Government to support companies that might be excluded from access to loans under banks’ standard risk criteria. They want the Government to extend the Enterprise Finance Guarantee on loans to businesses that do not have enough collateral to meet lenders’ normal requirements.
The Enterprise Finance Guarantee provides lenders with a Government-backed guarantee for up to 75pc of the outstanding balance of eligible facilities, potentially enabling a “no” credit decision from a lender to become a “yes”. It supports facilities
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Government issues small traders with EORI numbers as no-deal ramps up
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
The Government will automatically enrol companies with customs identification they need to keep trading with the EU should a no-deal Brexit happen.
HMRC will allocate more than 88,000 firms with an Economic Operator Registration and Identification (EORI) number in the next fortnight – double the existing number.
These unique identifiers are needed to track companies trading with the EU and collect duties.
Read: EORI number: What it is and hot to get or check one
Letters informing companies of their EORI number will start arriving as early as today.
Non-VAT registered businesses will still have to apply manually.
So far, 72,000 companies have EORI numbers. A total of 245,000 firms would need one an EORI number in the event the UK leaves the EU without a deal.
Earlier this month, the Liberal Democrats revealed that only 27pc of businesses which trade solely with other EU member states had obtained an EORI number.
Businesses without an EORI number will be unable to continue to trade with EU member states.
Government sources accused Philip Hammond, the former Chancellor, of blocking the automatic rollout of EORI numbers while he was at the Treasury.
Earlier this month Chancellor Sajid Javid ordered the Treasury to step up preparations
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Amazon retailers could find their businesses blocked in a no-deal Brexit
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Thousands of online retailers who use Amazon to sell their products could find their businesses switched off in the event of a no-deal Brexit.
Sole traders who use platforms such as Amazon and Google to sell online could find themselves blocked because the EU would not recognise UK data protection standards in the event of no-deal.
Although the UK has already said it would accept EU data compliance in the event of a no-deal Brexit, the EU has made no such pledge, leaving online retailers stranded.
Both Amazon and Google host huge amounts of data from giant centres based in Europe.
It could take years for the EU to sign off a data compliance agreement with an independent UK.
Read: third party platforms – is it worth selling through the likes of eBay and Amazon?
“Data flow is so ubiquitous in our day-to-day lives that if it stops, [we don’t know exactly what will happen], Claire Edwards, a partner at law firm Pinsent Masons told the Sunday Times.
The potential aftershocks of a no-deal Brexit on October 31 have been laid bare in confidential details of Operation Yellowhammer, the government’s no-deal contingency planning for a no deal departure, which were
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Michael Gove orders taxman to help small business if there’s no deal
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
The taxman has been ordered to soften its revenue-raising zeal in event of a no-deal Brexit, Michael Gove – the cabinet minister in charge of no-deal planning — has told business groups.
Ministers have told HMRC to drop its usual tough guy tactics when small businesses get into trouble paying tax late and instead be supportive, according to Sky News.
That did not mean that HMRC would cease normal tax-collecting actions, Michael Gove said, but that it should prioritise measures to ease the burden on SMEs facing financial strain.
Business organsiations present included the CBI, Institute of Directors, Association of British Insurers and the British Retail Consortium.
Other ideas discussed at the meeting included the possibility of VAT and National Insurance contribution holidays for SMEs, high-street banks relaxing their lending criteria for small businesses and easing the regulatory burden on businesses by suspending any implementation of new rules.
Mr Gove was joined at the meeting by business minister Jo Johnson and Sir Edward Lister, the prime minister’s chief of staff.
Other business groups that joined the meeting with Mr Gove were the Creative Industries Federation, the Food and Drink Federation, Make UK, Tech UK, UK Finance and UK Hospitality.
Further
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Small business will be especially badly hit by no deal, warns CBI
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Small and medium-sized firms are especially vulnerable in the even of a no-deal Brexit, the CBI has warned.
Four out of 10 SMEs that trade internationally have no contingency plans for Brexit, says the CBI. Fifty-six per cent of SMEs in Northern Ireland – the pinch point of Brexit negotiations – have yet to start planning. And 90pc of small architecture firms have found it impossible to start planning.
The CBI says that both the UK and the EU are unprepared for Britain crashing out of the EU on October 31, with Brussels surprisingly even less prepared than the UK.
Although businesses have already spent billions on contingency planning for no deal, they remain hampered by unclear advice, times, cost and complexity, says the industry body.
For hundreds of thousands of small companies, diverting precious resource – both human and financial – to Brexit preparedness measures is out of reach, says the CBI. They cannot hope to have access to anything like the in-house advice available to large companies, and government funds that can help them to do so have been poorly advertised and are now closed, says the business lobbyist. Eighty-seven per cent of CBI members
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Small business exporters shrug of threat of no-deal Brexit
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
As Prime Minister Boris Johnson assembles his “war Cabinet” to confront Brussels with the threat of a no-deal Brexit, small business exporters have shrugged off the risk of Britain crashing out of the EU.
The majority of UK SMEs that export internationally are more worried about President Trump’s “America First” trade policies and the risk of a global economic slowdown than Britain exiting the EU without a deal.
In addition, the majority of SME businesses say Brexit uncertainty has had “no effect” on their company’s international strategy, according to a survey.
In fact, 47pc of SMEs surveyed by OFX, are looking to start or increase sales to Western Europe in the next year.
Overall, British businesses are still keen to engage in global trade, with almost half (48pc) having increased sales by an average of £45,000 in the last year. Meanwhile, 44pc expect to start or increase international sales within the next 12 months.
However, President Trump’s protectionist trade policies – which include the threat of new tariffs on billions of dollars’ worth of European goods — have spooked SMEs. Western Europe has overtaken the US as businesses’ favourite export market.
Sarah Webb, president UK and Europe at OFX,