How Can Companies Find Extra Money To Help Prepare For A No Deal Brexit?
As we are all very much aware, a referendum on EU membership was held in June 2016 where the British public voted to leave. Ever since then, the focus has been on getting a deal through Parliament in order to exit as seamlessly as possible, although at the time of writing this has yet to happen.
The UK joined the EU (previously the EC) in 1973 and it has since had access to a single market allowing capital, goods, people and services to move freely across each of the member states. Joint decision-making has also occurred with regard to economic policy, as well as the adoption of certain EU-wide laws.
The new UK Prime Minister Boris Johnson has vowed to make Brexit happen on the 31st October - with or without a deal. So in practical terms, what does this mean?
Well essentially if arrangements are not made in time, the UK will lose 70 international trade deals immediately, meaning our currency is likely to devalue and goods may become subject to tariffs making many things more expensive. We also won’t have access to certain EU information like criminal databases and there will likely be goods checks between Northern Ireland and the Republic. But the UK’s preparedness for a no-deal Brexit is about much more than just politics; it means that individuals and businesses above all must take action so they can be ready.
In the summer of 2018, the government began publishing various ‘technical notices’ about how public bodies and businesses need to prepare for a no deal scenario. Brexit has always been about uncertainty, and a no-deal withdrawal simply means yet more of it. With everything from potentially having to pay more VAT and increased costs of customs checks to having to find new suppliers and suddenly losing access to EU workers, the costs involved for businesses are likely to be many and varied. This is why it’s highly recommended that companies find ways of financing these costs or they could end up seriously struggling.
Here we look at ways your company can save money so it’s in the best financial position to weather a no-deal Brexit storm.
1. Evaluate and simplify your systems and processes
Take the time to look closely at your company’s current work processes and procedures. This will allow you to locate the inconsistencies or flaws in a system and where efficiencies can be made. Consider if any roles could be reduced or cut out altogether in the form of redundancies, without diminishing the quality of the process. For instance, if you carry out a certain quality check twice, decide if one of those checks can safely be gotten rid of without quality standards slipping. If the work process is performed by a number of employees, look at how each one of them works to uncover any differences. Make sure any inefficient steps in the process are then streamlined.
2. Boost your social media offering to increase sales
What do Instagram, Facebook, Pinterest, Twitter, YouTube, LinkedIn, Tumbler, Reddit and Qzone all have in common? They’re all social media platforms that are completely free to use, where you can advertise your company’s goods and services absolutely free.
Whilst these platforms do also offer awareness campaigns and paid advertising, penny-wise business owners need to know how to optimise their free accounts to bolster their marketing efforts. Writing an engaging post or creating an eye-catching graphic, all finished off with a specific call to action, can quickly translate into new customers. And customers mean revenue.
3. Go 100% paperless
The trusty piece of paper could actually be costing your business far more than you think, with some surprising direct and indirect costs at play. Paper requires shipping, storage, filing, sorting and posting – all very labour intensive activities that could needlessly be costing your business thousands. Producing things on paper is also quite slow, so time is eaten up that many companies can ill-afford – after all, time is money.
With all the technology available nowadays for documenting, messaging, storing, data sharing and processing, many companies are discovering that paper simply holds them back and with cloud technology it’s all easily accessible too.
4. Take on remote contracted employees
For many businesses, a large percentage of operating costs are taken up in employment expenses. Staff members that work onsite require computers, desks, equipment and facilities – all of which cost serious money. However with contracted help, businesses are able to take on admin assistance, web designers, content writers, advertisers, IT engineers and more, all whilst keeping their core team intact. By employing remote help, companies are saving a lot of the expense of having a team member sitting at an office desk.
5. Switch suppliers
Some businesses may not have the same access to EU suppliers that they have now so it’s a good time to look at the value for money your suppliers are offering and whether they’ll still be there for you after a no-deal Brexit. Then, save money and hassle later on by seeing if you can switch.
6. Take advantage of government funding for innovation
Does your business, however large or small, undergo work that involves research and development? You could receive help from the government towards the costs.
Whether your company is developing a new product, service or process (or is enhancing an existing one) it is likely to qualify for R&D tax relief. If this innovation requires money to be spent, you can make an R&D Tax Credit claim in order to receive either a reduction in your Corporation Tax or a payable benefit as a cash lump sum. The good news is that just about every industry can be eligible as the scope for identifying R&D is massive. Plus if it’s your first claim, you can make an additional tax relief claim for your last two full accounting periods.
Then there are R&D Grants too. Backed by the UK government, grants that are designed to help with research and development are administered by Innovate UK. These are awarded via competitions, where companies based in the UK make their pitch before winners are selected. UK innovation grants are typically offered for these types of projects:
- Creating new products, services or processes, or improving existing ones
- Early research studies;
- Collaborative working to complete research alongside other companies, institutions or organisations
The amount of grant a company will receive can be anything from £25,000 to a cool £10 million. They’re very often technology grants but as long as innovation has taken place, anyone can be in the running. A handy cash injection for any business, especially with a no-deal Brexit on the near horizon.
Get in touch with the team at Tax Cloud
The Tax Cloud calculator is the brainchild of Myriad Associates who are experts in all aspects of R&D accounting. With separate arms for both businesses and accountants, its sole purpose is to make R&D tax relief calculation quicker and simpler, saving you time and money.
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