With under a month to go until the UK leaves the EU, one of Wales’ leading independent accountancy and financial planning firms is warning that many small to medium-sized businesses in Wales may not be Brexit-ready after firefighting COVID-19 for most of the year.
Bevan Buckland LLP, which has five offices across South-west Wales, is urging SMEs – the family businesses that are the backbone of the Welsh economy – to get ready for the new landscape that Brexit will bring in just a matter of weeks or potentially face dire consequences.
Harri Lloyd-Davies, from Bevan Buckland LLP, said: “It is understandable that Brexit preparations have taken a back seat for many business owners in Wales in light of the Coronavirus pandemic. But it is vital that they now turn their attention back to Brexit, since the transition period ends on December 31 and we will all be operating under a new system, with new responsibilities and regulations coming into force on January 1. Companies in Wales that have managed to survive and even thrive under the impact of COVID-19 should do all they can to avoid being impacted by any regulatory and economic shockwaves Brexit may cause.”
Just this week the ONS (Office for National Statistics) found that just nine per cent of business in the UK felt they had prepared for the post-Brexit landscape, with 10 per cent not sure if they had done so.
Harri continued: “Many firms in Wales, which do not import, export or interact with our European neighbours, may feel that the changes may not be very impactful to them, but there will still be implications that they have not considered. Being prepared and well-informed is crucial if you want your operations to continue unhindered in what is already a very tricky landscape due to the pandemic. A major consideration should be any impact on supply and distribution chains, either through increased regulatory requirements or physical delays and impacts to transport capacity. We are already getting feedback from clients who are seeing their supply chains being impacted by the increased demand on UK port capacity.
“There are also major unknowns – something no businessperson welcomes – not least that we do not yet know if there will be a deal or no deal between the UK and the EU. However, we do know there are significant changes ahead for travel and trade. And we can prepare for these. Businesses should be using the government resources out there to help business owners prepare and if you are concerned, it is important to seek tailored professional advice to drill down into the implications for your business.”
Points to consider, says Harri, include general business preparations, with the Government’s Brexit transition website – www.gov.uk/transition – being the first port of call for general advice. If you trade with the EU then you must register for an Economic Operator Registration and Identification (EORI). And businesses should be aware that export rules are specific, sector by sector, so again, the Government website can help with a personalised list of action that firms need to take.
Businesses that export must also familiarise themselves with customs declarations as these will be essential for accounting for VAT. Similarly, if your business relies on EU or other non-UK workers, new rules will need to be adhered to.
Harri adds: “The rural community in Wales will have kept a close eye on the Agricultural Bill, which was passed through Parliament very recently. This removes the Common Agricultural Policy (CAP) and replaces it with new UK supports for farmers.
“It is worth noting too, that as well as passing legislation to ensure UK rules and regulations are transparent at the end of the transition period, the Government is negotiating new trade deals. As an EU member, the UK was part of 40 trade deals which the EU had with more than 70 countries. More than 20 of these existing deals, covering 50 countries or territories, have been rolled over and will start on 1 January 2021. Fifty-two countries currently have free trade deals in place with the UK for the end of the Brexit transition period. It is important that exporting firms in Wales familiarise themselves with the trading status of countries they export to, so there are no surprises waiting for them.”
Harri adds: “Welsh businesses are resilient and adaptable – the response we have seen within the business community over the past few months underlines this. And there is much support that can be tapped into. It is important that proper expert advice is sought as soon as possible. Businesses that believe Brexit will be a ‘storm in a teacup’ quickly followed by business as usual, may live to regret not preparing for the fundamental changes it will bring to how they operate and trade.”
Bevan Buckland LLP is the largest independent accountancy firm in Wales providing practical support and strategic accounting, tax and financial planning advice for small to medium sized businesses. Headquartered in Swansea, the firm has offices in Carmarthen, Pembroke Dock, Haverfordwest and St David’s.
For more information visit: www.bevanbuckland.co.uk