On 30 January 2020, the UK formally left the European Union. This is likely to have a long-term negative impact on UK companies because:

• It is more difficult for UK companies to

access the large EU market because of tariffs and customs delays. Customs tariffs increase the costs of both imports and exports across the UK border. Higher costs blunt the competitiveness of UK firms.

It is more difficult for UK companies to hire

European talent, because of the need to apply for work visas for non-Uk staff.

• The UK must negotiate new free trade agreements with partners around the world, including not only the EU but also countries in Asia and the Pacific. These negotiations take time. The UK has still not signed a free trade agreement with the United States, its biggest trading partner after the EU. (There might be updates from the Gov any time, please check the Gov.uk website)

Annual accounts must be prepared and submitted to the Inland Revenue and Companies House. Accounts submitted to Companies House are available for public inspection. However, dormant companies and 'small companies' defined in the Companies Act only need to submit abbreviated accounts. This means that only the company's balance sheet and notes are made public, rather than the company's income or cash flow statements.

- The UK government plans to introduce legislation banning the use of corporate directors.

- UK banks apply strict onboarding processes. A UK company will likely only be onboarded if the majority of directors and shareholders are UK

resident.

Value-added tax (VAT) is charged on the value of supplies of taxable goods and services made in the UK, including some exports to European Union (EU) countries. It is also chargeable for imports of goods from outside the EU. The main rates are 0% and 20%, but a few supplies are charged at 5%. Under the UK-EU Brexit settlement, Great Britain and Northern Ireland now have customs borders and a separate VAT

system.

The UK is an expensive country from which to run a business. For example:

• London has by far Europe's most expensive office rents.
• Salaries are higher than the European average.
• The UK minimum wage is higher than most European countries but is on a par with Germany, France and other western European countries. The cost of living is high in London compared to other large global capitals.