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Leaving the EU so far has been a lot like Madonna’s song, Hung Up. As Mads says: time goes by so slowly… every little thing that you say or do… I’m hung up on you.
It can feel hard to tear ourselves from the news and what on earth is going to happen next?
I wanted to share with you my views for what may happen with EU VAT in the wake of the referendum.
As co-founder of EU VAT Action (the campaign who went to Brussels and persuaded the EU to introduce a threshold for EU VAT), I attended meetings with Number 10, HM Treasury and HMRC and been featured on the BBC, City AM and Global Finance (learn more).
I’ll be covering:
Grab some popcorn (or cake) and let’s gather our energies and adjust to whatever the new realities are going to be for complying with EU VAT.
This is a safe space for you to learn what you can do now.
It’s a myth that leaving the EU makes EU VAT disappear.
Leaving the EU isn’t a twinkly fairy godmother waving her sparkly magic wand so it all goes away. EU VAT will not turn into a pumpkin. It’s a global tax not a soup ingredient.
The need to comply isn’t dependent on our membership of the EU. EU VAT applies whether we are in the EU, out of the EU or in any arrangement the politicians haven’t invented yet.
So if you export your applicable digital sales to an EU country (aka a consumer in Germany bought your e course), EU VAT will still apply.
Moreover, other countries are introducing a tax equivalent to EU VAT and some countries already have.
So whether the UK is in the EU or whether it isn’t, EU VAT still applies.
So now we’ve sorted out that myth, let’s move on to what’s going to happen next.
No-one knows what’s going to happen, this is unprecedented territory.
What we do know is the system stays the same until the UK has actually left the EU (learn more).
Let’s look at some options:
Most of these options are, excuse my French, shite. (I better not use the Anglo-Saxon word 😉 )
On the other hand, let’s not throw our toys out of our prams. Nothing changes for 2 years and who knows what will have changed in that time. Our lives could have been made a lot easier by a yet-to-be-invented international agreement.
(If you’re thinking this is all a bit grown up businessy, yes it is. When we have the privilege of being of service to people all over the world in our business, international rules become part of it. Tax is how governments pay their bills and currently we have an international tax system designed for the 19th and 20th centuries, not the 21st century. That’s what changing.)
Time for cake and a cuppa. And a photo of a pug in a blanket #becauseitstheinternet.
So how does all this affect your business right here and now.
We’re still in the EU. Nothing essential will change for 18 months- 2 years.
Keep up to date with what’s happening (join my mailing list so you can trust you’ll hear about major changes) and keep positive.
Even crystal ball owners and fairy godmothers (and politicians) can’t predict what’s going to happen as this is more than only the UK leaving the EU, it’s a global shake up.
There are also major international tax changes happening, and even at the glacial pace of law change, it’s happening pretty fast and these are changes that affect the smallest to the largest businesses (it’s that ability to sell worldwide privilege again).
So… next steps….
We know the UK will be in the EU until the negotiations end after Article 50 is activated. Then it’s 18 months – 2 years of negotiations and we’re out (assuming the EU still exists by then. It wouldn’t surprise me if a green headed martian appeared on earth by this point, it’s so freakin’ weird what’s happening at the moment).
We need to stay informed and keep calm.
We need to take action.
We need to look after our individual self care to keep centred and grounded.
We need to look at our businesses and fill in the gaps, you know, all the stuff you’ve been putting off, to make our businesses as resilient as possible:
Now is the time.
When life gets uncertain, go to the basics.
And we need to look after each other and raise our vibration (if you’re an Abraham Hicks fan).
As Starship said, nothing’s gonna stop us now #totalcheese #wecandoit
(This is a place to share and support. Any arguments or abuse will be deleted without notice).
If you need one to one support knowing what to do with your business finances and systems during this period of uncertainty, learn more about coaching.
If you need an at-your-own-pace tax return course that’s easy to understand, have a look at How To Do Your Own Tax Return course.