An old friend rang me last night about her training business. She had spent several days reading Brexit information and asking her accountant about what will happen and what she needs to do in order to keep trading throughout Europe if we Brexit. I was shocked that she had not found any easy way to make sense of it all – despite the millions spent on getting everybody ready.
If you are running a UK based training business here are some key things you need to know.
UK based training business working only in the UK
A hard or soft Brexit will make no short term legal or tax difference to the way you need to work IF you are only working with UK delegates and UK clients and if you sell nothing at all online and offer no virtual services. If that is how you run your business you can focus on selling your courses.
Training and coaching online with EU organisations, customers and delegates?
If we hard Brexit, you will need to update your contracts and GDPR handling as we will become a ‘3rd country’ for the purposes of GDPR. You should continue to secure delegate and contact data but you will need to incorporate the appropriate EU Model clauses.
Offering products and downloads online?
We briefly had a threshold for Digital VAT in line with the UK threshold for VAT registration. This will cease when we Brexit. You will need to look at your business and decide whether to ‘geo-block’ and confine your sales to particular countries or areas, or whether to register for VATMoss in the EU country you make sales in. Another option is to make sufficient element of live support come with your products to make it exempt for Digital VAT. You will need to work out the costs/benefits for this. A lot will depend on how much revenue, doing what. Many accountants have no idea about Digital VAT – so make sure you get together with someone who works regularly with digital entrepreneurs who trade online.
VAT on sales to EU Countries?
If you are VAT registered in the UK, you will invoice EU personal customers ex VAT. For business customers in the EU, you will need to work out your ‘place of supply‘ , but you will no longer need their VAT registration
The ‘place of supply’ defaults to where your business customer belongs if you don’t trigger any other criteria. Having a fixed establishment in the UK or living in the UK can trigger other criteria, so take advice from your accountant before deciding what to do.
For some of us who are increasingly global, deciding where we live and work is more complex than it looks.
You will need to keep an eye on your VAT return as HMRC will need you to account for EU revenue differently if it is to become simple overseas revenue.
Working in EU countries
If your business involves training or coaching in person in the EU, you are going to need to check out whether you need a work permit.
A lot depends on whether you are working through a company, a sole trader, and the country you are going to. Work permits take time and cost money.
There is no guarantee you will get one either. Most of us are used to just jumping on a plane or a train and doing the work. This is going to add an extra layer of complexity.
Take on local associates or work virtually?
You may want to consider taking on local associates as subcontractors acting under license or delivering more of your work virtually. Every trainer business is unique and what works for you may be different to what works for other people.
This can be a really big decision and you should make sure you are properly set up not only to deliver the right quality of work to your clients but also to protect your business.
You don’t want to be cut out by an enterprising associate. Nor do you want to lose access to working with clients across the EU.
What about contracts and GDPR?
If you are an existing KoffeeKlatch customer using our trainer terms of business or training booking agreement (for your associates), we will switch you over to our Global Trainer range at no extra charge during your support period if you let us know you need to work across the EU.
If you are already working across the EU (or globally) then go straight to our Global Terms.
If you are a member of our Trainer GDPR support group we will be updating you on what needs to be done.
We have got your back.per.