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EU Exit Readiness check for SMEs

With Jonny Boström, of Structure Finder, and Johan Aurén, of Accountum

Structure Finder are a business enabler who support international businesses with their compliance in Sweden. Accountum help Swedish businesses set-up in the UK providing end-to-end accounting and tax advice.

Services

If you sell services to the UK this will have an impact upon your VAT registration once the UK leaves the EU. The changes in Common Law may encourage businesses to set-up UK branches as simple VAT reclamation will not be as simple as it previously was.

Moving Goods

You will need an EORI (Economic Operator Registration and Identification) number to move goods between the UK and non-EU countries from the 1^st of January 2021. You will also need to consider when you will be VAT registered too.

VAT and Duties are two separate areas. You can look at deferring paying duties with HMRC if you are regularly. There is around a 120 day period to acquire a deferment account and so you need to talk to an intermediary now as demand will soon be high.

The new deferment account is for a business with goods exported below the value of £10,000 a month.

Make sure you have registered with Skatteverket to get all of the administration documents in place. There will also be customs handling in Sweden which you can quickly apply for a permit for.

Question

If you buy goods from the UK will you have to pay VAT and what do you expect from the UK Government- will they raise their VAT?

From a Swedish perspective: they should not apply any VAT on it and you will have to declare this. It is all about place of supply. It appears there is also not much talk about changes (higher or lower) but it will likely stay around where it is now.

E-commerce

Any OLP business that sells goods to UK customers will need to register for VAT in the UK- unless the consignments you sell are worth under £135. The online market place in many cases will be accountable for arranging this.

If you have a Swedish online platform, shipping to a UK customer, you should not apply VAT as it will be considered an export. You will not be able to reclaim VAT from Skatteverket when it originates for the UK and so you shall have to register with HMRC.

MOSS (Mini One Stop Shop) will not be applicable for UK trade after this year.

Question

What areas can you see are still up for discussion- where are the grey zones in post-Brexit trade?

Entrepreneurs are expected to test the system and find loopholes: so we expect changes to regulations to gradually occur.

Question

How will SMEs, across Sweden, find out about how to prepare for trade with the UK post-Brexit?

Most of the large companies will already have received consulting on this matter. However, SMEs are going to have to actively look through the changes. HMRC also have a very good service online which offers key helpful points for Swedish businesses.

GDPR

This stands for ‘General Data Protection Regulation’ and is the transfer of personal data from Europe into the UK.

There is a special agreement, being worked on, which may be in place by the end of December and could potentially ease any GDPR issues.

The UK has been very positive towards the general rules of GDPR. The current guidance recommends SMEs to follow existing GDPR rules and compliant businesses will be in the best possible position.

The adequacy decision will be, hopefully, completed by the end of the year. The delay, or potential stall, on the answer of the adequacy decision could be damaging and may be caused for political reasons.

Hiring

If you are hiring people in the UK (arriving before 1^st December) they can apply for the settled status grant. For a Tier 2 visa (20 points) it does not look too difficult from a UK perspective and the full 20 points can be acquired by paying someone £20,480. There is the Youth Mobility Scheme which may be extended to European countries.

If you are a UK citizen living in Sweden there are not many planned changes.

Our thanks go to Jonny Boström, of Structure Finder, and Johan Aurén, of Accountum, for hosting this event with the BSCC

Date: 4 November 2020
Time: 10.00 – 11.00 CEST
Venue: Zoom