Unfortunately, and even without the uncertainties surrounding Brexit, SMEs are anything but optimistic as 4 out of 5 of those polled by ICAS, the Professional Body of Chartered Accountants, fear for the economy going forward. Now with matters compounded over fears stemming from the vote, it does look as though SMEs in Britain are bracing to battle an uncertain economic future.
Growing numbers of company owners and directors are contacting their solicitors because they need answers and many legal teams are already drawing up tentative new agreements set to commence when Brexit is finalised. Amongst those being contacted by panicked business owners is Leeds law firm Ison Harrison. Some of the following information is gathered from conversations with their established clientele.
The GBP Is Losing Ground by the Day
What started out as vague concerns over trading in a volatile market has escalated as the pound fell overnight the day of Brexit and continues to lose value as the days wear on. If this continues, many fear there will be another recession greater than the last. Fortunately, this is just the fear of some businesses, private individuals and a few market analysts. Nothing is forthcoming from the government which is why there doesn’t seem to be a reason to panic just yet.
Having said that, it is still a concern that the pound continues to lose ground. Some who weren’t concerned before are starting to worry now because there is no logical reason for such a swift fall in its value. Brexit shouldn’t have weighed that heavy on the market. So what is causing the continued loss in value?
Compounded Concerns over VAT and Import Taxes
This is where concerns over an uncertain economic future have now been focused. Before Brexit, SMEs knew what they were required to pay in terms of VAT and import taxes were not an issue due to internal EU trade agreements among member nations. Although the government is saying that things will simply go back to the way it was before joining the European Union, many young entrepreneurs were too young to remember those days and aren’t aware of how things were done ‘back in the day.’ This presents a whole new set of worries that is compounding fear over the economic future of the UK.
As legal representatives to a large number of businesses throughout the UK, Ison Harrison is advising clients to take a step back and not to panic. Until the dust over Brexit has settled, much is still just conjecture. There is talk of yet another referendum and even if there should be, business must go on. Solicitors and accountants are ready to answer any questions their clients may have and until something more is forthcoming from the government on time frames, the best thing to do is sit tight and listen to your legal representatives. In other words, don’t panic. There is no reason to presume a collapse is coming and the best thing you can do is what you do best. Run your business as you always have.
