BREXIT – what actions are required for companies doing business with and within the UK
More than a year has passed since the UK formally opted to leave the EU. We published our first blog on Brexit shortly after the UK formally triggered Article 50 of the EU treaty (withdraw from the Union). At that time, we discussed the likely scenario of a transitional period after the time-frame to conclude a final withdrawal agreement with the EU within two years. We also discussed the likely tax implications and potential steps that could be taken to mitigate or reduce the tax impact of a Brexit. In this blog, we will assess the latest status in the negotiations between the EU and the UK, and update our views and takeaways.
08 May. '18 Patrick T.F. Schrievers
At the end of March 2018, both the EU and the UK presented a joint text of the Withdrawal Agreement which was perceived as a ‘decisive step’ in the negotiations. However, the text published illustrates that there remains a lot of work to be done and some significant issues are still to be resolved. One key aspect is the inclusion of a transition agreement to the end of 31 December 2020, which should allow both parties more time to negotiate the entire agreement. Furthermore, the text covering citizens’ rights and the financial settlement appeared to be agreed. It is confirmed that citizens arriving in the EU or the UK during the transition period will have the same rights as those arriving before. It should be noted however, that even in respect of areas that are agreed, legal certainty on an agreement will only come with legal ratification, which is scheduled for the end of 2018. Also, the UK Parliament has to approve the Withdrawal Bill once it is final.
What if the UK’s departure from the EU would cause too many adverse (tax) implications?
