Theme selected: Impact of Brexit on Accounting Practices for UK SMEs. From VAT shifts to customs paperwork and cash flow pressures, this home page guides small and medium businesses through practical accounting changes, real stories, and actions you can take today. Share your questions and subscribe for ongoing, Brexit-focused accounting insights.
VAT After Brexit: What UK SMEs Must Capture and Reconcile
Postponed VAT Accounting (PVA) in Practice
PVA lets you account for import VAT on your VAT Return instead of paying at the border, improving cash flow if reconciled properly. One Midlands wholesaler cut monthly outflows by five figures after aligning C79-equivalent statements with landed cost journals.
EU VAT Registrations, OSS/IOSS, and Non‑Union Options
Selling digital services or low-value goods to EU consumers may require non‑Union OSS or local VAT registrations. Map customer locations, channels, thresholds, and fulfillment points, then build a VAT matrix that drives invoice tax codes and automated return workflows.
Northern Ireland’s Special Status for Goods
Under the post‑Brexit arrangements, Northern Ireland applies EU VAT rules for goods, often using an XI prefix for VAT/EORI. Accountants must segment NI transactions, maintain evidence of movement, and ensure returns, EC-style reporting, and invoices reflect correct jurisdictional treatment.
Cash Flow Resilience Under New Trade Frictions
Even with PVA, timing differences arise between goods receipt, invoice arrival, and VAT Return cycles. Model these lags in a 13‑week cash forecast and align supplier invoicing cadence to avoid unexpected VAT peaks strangling working capital.
Cash Flow Resilience Under New Trade Frictions
Cross‑border risk can stretch days sales outstanding. Tie credit limits to up‑to‑date country risk scores, add currency‑specific dunning rules, and pilot early‑payment discounts funded by improved landed cost accuracy to reclaim liquidity without harming relationships.
Financial Reporting, FX, and Risk Disclosures
Shifted sales mix and euro‑denominated purchasing can change primary economic environment indicators. Document your functional currency assessment, hedge accounting choices, and sensitivity analyses so auditors see a robust, repeatable framework anchored in actual cash flows.
People, Payroll, and Cross‑Border Services
Assignments between the UK and EU generally need certificates to confirm where social security is paid. Capture certificate periods, host country rates, and employer liabilities so payroll journals and project costs stay accurate and auditable.
Digital Trade, Marketplaces, and Data Controls
Platforms may collect VAT on certain sales. Reconcile marketplace statements to order data, segregate platform‑collected tax from your own liabilities, and adjust revenue presentation so gross versus net reporting remains clear and defensible.
