Navigating Brexit: A checklist for Manufacturers

With Brexit approaching, it is more important than ever that manufacturers plan ahead. Understanding how individual risk factors might affect their business model is critical and the degree of risk exposure will vary from business to business. Business leaders must take ownership of the situation and prepare a bespoke Brexit plan to support them through the changes that lie ahead.


Brexit: What are the hidden costs of selling your products abroad?

In order to continue exporting goods to the EU market in a ‘no deal’ scenario, you must ensure that your company holds a UK EORI number and that the receiving importer has an EU EORI number – even if this is within the same organisation. Export declarations will be required for all goods from 1 January 2021.

Common Transit convention (CTC)

You may be able to use the Common Transit Convention if you are transporting goods across borders in the EU. As customs declarations would not be required at each border crossing, it will speed up the movement of the goods. In addition, duties only become payable once the goods arrive at their final destination.

New Computerised Transit System (NCTS)

The New Computerised Transit System will allow for transit declarations to be made electronically and away from the border, simplifying procedures.

Goods Vehicle Movement Service (GVMS)

The Goods Vehicle Movement Service, which is the new border IT platform to allow trucks to declare goods ahead of reaching the border, will be introduced from January for transit movements only.

In the event that we do not reach a deal with the EU, an inspection fee may need to be paid for certain goods on entry to an EU country, together with regulatory changes to labelling and marketing of certain products. The import of live animals, plant or food products are particularly affected.

Brexit: How can you protect your manufacturing supply chain on EU imports?

HMRC has now published its first draft of the Border Operating Model (BOM), setting out the UK’s approach to the EU border from 1 January 2021. Controls on the movement of goods will be phased in over three stages until 1 July 2021, in order to recognise the disruption to business caused by the coronavirus pandemic and giving businesses the time to prepare. The three phases will be introduced on 1 January 2021, 1 April 2021 and 1 July 2021, slowly bringing in checks on certain categories of goods and deferring completion of customs declarations and payment of tariffs through to full customs declaration submission and payment from 1 July 2021.

Customs declarations

Importers and exporters will be required to complete customs declarations, with some locations requiring pre-lodgement of the declaration prior to movement of goods.

Customs duties

Payment will be due as applicable under the new Global Tariff, with deferment a possibility.

Safety and Security declarations

The UK Government will collect more information on goods moving into the UK from the EU.


Import VAT will be due, although postponed import VAT accounting should be available.

There are other HMRC schemes that may be applicable which defer or suspend the need to pay duty and import VAT on goods. Specifically, Import Processing, Inward Processing and Temporary Admission reliefs are valuable as they can help to manage cashflow pressures.

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Brexit: Ensure your key employees have the right to continue working in your factory.

The UK government has reached agreements to protect the rights of EU, EEA and Swiss citizens living in the UK enabling them to claim settled status with similar rules applying for those UK citizens living in the EU, EEA or Switzerland by virtue of the Withdrawal Agreement. Those affected will need to apply prior to 30 June 2021.

Global Talent Visa Scheme

To protect the UK’s knowledge economy and ensure continued ability to scientists and researchers, the UK has introduced a Global Talent Visa scheme which supports those that work in academia or research if you are a leader within the fields of science, medicine or engineering.

Points Based Visa Scheme

The UK will also be introducing a Points Based Visa Scheme with effect from 1 January 2021 and individuals who do not qualify for settled status or Global Talent Visas will need to apply and qualify under this scheme.

The Skilled Worker route (under the Points Based Visa Scheme), includes no overall cap on numbers so will be relevant to manufacturing businesses looking to secure talent from abroad. This does require the applicant to have an offer of a job from a licenced sponsor, a minimum standard of English and a minimum skill level. They will also need to earn an additional 20 points which can be secured a number of ways, but for example, by earning more than £25,600 or being in a shortage occupation.

Following the end of the transition period, businesses will also need to consider whether work permits or visas are required for UK employees to operate in the EU.

Brexit: Consider repatriating profits before 31 December.

In the event of ‘no deal’ Brexit, the Trade Agreements that provide favourable terms for EU members would not be effective for UK companies. Businesses should assess the likely opportunities and threats of expanding into a new territory without a trade agreement and how they will continue to trade within, and outside, the EU under World Trade Organisation tariffs and rules.

Post Brexit trade agreements

It is important to keep abreast of who the UK are negotiating trade deals with and how advanced these discussions are. Currently, post-Brexit we only have trade agreements with Japan, with a further 20 countries expected to take effect when existing EU trade agreements no longer apply to the UK, from 1 January 2021.

Upon leaving the EU, we will no longer be within the remit of the EU tax directives and this may result in local withholding tax which would reduce the value of funds that can be remitted from the UK. In addition, the cessation of the EU Interest and Royalties Directive will impact cross-border interest and royalties paid to or from a UK company.

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