It’s been a couple of months since the Brexit vote, and while the dust has slowly been able to settle on what was an unquestionably surprising result, we’ve had the time to look into the ways in which British contractors are likely to be affected from our leaving the European Union (EU).
It’s important to note that though the Brexit vote has resulted in some immediate changes to the British economy, including but not limited to the weakening of the pound, new Prime Minister Theresa May has made it clear that the earliest that Britain would give its ‘notice’ to leave the EU, by triggering Article 50, won’t be until the first few months of 2017, after which there will be an up-to two year negotiation period before any changes begin to take place.
Homegrown Legislation is Greater Pain
One of the driving forces of the leave campaign was their assertion that, outside of the European Union, Britain would be able to drop all EU laws as we pleased. This includes the Agency Workers Regulations (AWR); a piece of EU legislation that has proven to be contentious among British contractors.
But there’s a twofold problem here. Firstly, if the UK is going to retain access to the single market then we’ll have to continue to abide by certain EU laws. Secondly, many contractors agree that certain pieces of homegrown legislation, such as IR35, are a much greater pain for contractors to negotiate than anything the EU has thrown their way.
Trade and Immigration Changes
The changes to trade and immigration, especially with regard to working in EU countries (more on that below), is an area in which it’s difficult to predict what is likely to happen.
There’s a good chance that the UK will stay a part of the single market, at least “in some form,” as was former Prime Minister David Cameron’s wording prior to the vote. Depending on how much a part of the single market we remain will make a big difference to the changes British contractors can expect to see post-Brexit.
Contracting in European Union to Require More Hurdles
Contracting in Europe, that is, travelling to Europe to fulfil contracts, or simply selling our services to European customers from home, is an already complicated affair. Britain’s exit from the EU is only going to create more hurdles for contractors looking to work in and with EU countries.
Depending on what trade deals and free-movement of people deals are put in place (with visa-waver schemes potentially having to be set up), these hurdles may be small or they may be great. Only time will tell, but it’s highly unlikely that UK contractors will be shut out of the EU altogether.
Experienced Contractor Accountants
To speak with a professional accountant to discuss how Brexit may affect your contracting business, both at home and abroad, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.