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Your Brexit checklist

Feb 08, 2019
Whatever form it takes, Brexit requires you to be ready from day one. With time running out before the UK leaves the European Union, businesses and firms need to prepare for every eventuality to protect themselves against all of the potential disruptions that might follow. Answer the questions below and ask yourself: is my business ready for Brexit?

Customers and contracts

  • Have you engaged with all your key clients to understand their particular needs in the first few months after Brexit?
  • Have you considered which of your contractual obligations may be impacted by Brexit?
  • Unless tariffs can be mitigated, price inflation poses a significant risk to the cost of services. Have you fully identified and understood this potential threat along with options to mitigate?
  • Have you transferred all impacted Brexit customer contracts to an appropriately regulated entity, either in the UK or the EU-27?

Cash flow and currency

  • Have you considered the impact of a weakened Sterling on your transactions to and from the UK?
  • Have you determined what impact price inflation and tariff changes will have on your cost base, and your ability to mitigate, absorb or pass them on?
  • Have you identified the impact of import VAT on your cashflow? It should be noted that both UK and Irish governments have announced proposals to allow VAT on imports to be delayed until the next VAT return filing date rather than imposing VAT upfront on imports. 

People

  • Have you carried out an impact assessment to determine the possible effect of Brexit on your employees and your business model?
  • Have you mapped where your employees have come from, where they are now and where they may be travelling to as they perform their roles?
  • Have you reviewed your social security arrangements and whether they may need to be reviewed once the UK leaves the EU?
  • Have you considered the possible impact of foreign exchange rate fluctuations on your globally mobile employees?
  • Have you relocated or recruited all necessary staff to perform the required control functions in your regulated entity, and do they meet the relevant competency standards?

Contingency planning and regulation

  • Have you secured all of the necessary regulatory approvals to continue to provide financial services to your customers across the EU and the UK?
  • Where you plan to continue to access the UK market and UK clients, have you registered with the UK FCA to avail of their Temporary Permissions Regime?

These are examples of the types of questions where your answer should be 'yes' to be confident you and your company are prepared for Brexit. You should also have considered any changes to your organisational structure, tax arrangements and IT infrastructure that may be required.

David McGee is a Brexit Leader at PwC Ireland.

This article was updated on 11 February to reflect to reflect Minister Paschal Donohoe’ proposal to introduce a legislative change to introduce a system of postponed accounting.