On 31 October 2019, Britain might leave the European Union. Exactly how this will happen and the exact impact remain unclear for the time being. All the same, we would like to provide a few useful tips to help you prepare.

This advice will prepare you even in the worst-case scenario: a hard Brexit after which Britain can no longer benefit from single payments in the SEPA zone. Of course, things may also not work out that way.

1. Remember the BIC-code

If Britain no longer falls within the SEPA scheme, the single payments area for European countries and other closely related countries, transactions between European and British companies will be treated as normal international payments. This means that identification will be mandatory, preferably using a BIC code. If you only have your UK beneficiary’s account number – or that is the only account data they have about you – then you will no longer be able to pay.

How can you prepare for this? Simple: contact all your UK suppliers before the Brexit and request their BIC codes. And if you want to have your own outgoing invoices paid on time, don’t forget to give your overseas customers your own BIC code.

2. Determine who will pay the bank charges

A hard Brexit will create a lot of extra costs, and the banking world will not be spared. If payments to and from the United Kingdom are no longer covered by the SEPA scheme, both the beneficiary and the payer will be charged transaction fees. The distribution of these fees is not 50/50: it is determined individually for each bank. So each party will pay the fees charged by its own bank.

If you do not want to pay the fees, you can of course include them in your invoice – if your business partner agrees, that is. Or, to be more customer-friendly, you could split the costs.

3. Examine your standing orders

Depending on how Britain separates itself from the European Union, it may also be a good idea to take a close look at your standing orders. Payments to and from the United Kingdom may run into difficulties due to missing data. Ask your beneficiary or supplier for information such as BIC codes, account numbers, the exact company name and the correct address in good time.

4. Sort out your direct debits

Direct debit payments are a category in themselves. Within the SEPA zone, you can easily pay by direct debit across national borders. If your beneficiary’s country does not form part of the SEPA zone, this payment method is not permitted by law.

You will therefore need to modify your payment flow if the UK leaves the SEPA zone after Brexit, for example by going back to good old-fashioned invoices.

5. Make clear agreements

Last but not least, a general tip: make clear agreements with your business partners and put them on paper too. This will avoid unpleasant disagreements afterwards. A watertight contract is still the best guarantee for keeping your head above water, even after Brexit.

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