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The crucial way firms need to prepare for a no-deal Brexit

·Finance and policy reporter
HMRC is warning firms to prepare for Brexit. Photo: Kirsty O’Connor/PA Wire/PA Images
HMRC is warning firms to prepare for Brexit. Photo: Kirsty O’Connor/PA Wire/PA Images

The government has warned more than four in five British firms will be unable to trade with the EU under a no-deal Brexit unless they register in the next month.

HM Revenue and Customs (HMRC) says only 41,000 firms which trade with Europe have filled in the necessary paperwork so far. A staggering 83% of the estimated 240,000 firms affected have still not registered.

With the clock ticking down to the UK’s scheduled departure on 29 March, the appeal suggests officials are highly concerned about the level of preparedness in UK business.

Adverts are also set to appear on our TV screens soon advising the public on how to prepare for Britain crashing out without a deal, a Downing Street spokesperson told Business Insider today.

As HMRC issued its latest warning to British companies this week, it set out its guidance on the three steps they may need to take to carry on trading if Britain leaves without a deal.

READ MORE: Pound rises as fears ease of a no-deal Brexit

Firstly, firms will need to register for an Economic Operator and Registration (EORI) number, though some may have done so already if they have previously traded with countries outside the EU.

Secondly, they would also need to make customs declarations on exports and many imports if the British government fails to reach an agreement with Brussels that would protect existing trade rules and freedoms.

HMRC says companies should now consider how they would make such declarations, whether doing it by themselves or appointing a customs agent.

Thirdly, firms that import goods using roll-on, roll-off locations can register for Transitional Simplified Procedures (TSP), which lets them avoid full customs declarations and delays paying import duties at the border.

READ MORE: Goldman Sachs predicts May’s deal will still get over the line

Mel Stride, financial secretary to the UK Treasury, said: “We want businesses to be able to continue trading with minimal disruption in any scenario but we also know that people tend to leave things until the last minute and we would urge against that.

“We are specifically advising businesses to take some simple steps to be prepared – the first thing they need to do is register for an EORI number – it is free and takes less than 10 minutes.”

HMRC has already written twice to VAT-registered firms which trade with the EU, but the warnings appear to have had only a limited effect.

Around £3m of the £8m in funding to train firms in making import and export declarations has still not been handed out, with the government appearing to suggest not enough firms have applied.

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