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Services

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A company established in the EU can sell its services to customers in other EU countries without the need to have a physical location in that country. The freedom to provide services covers industrial, craftwork and commercial activities, as well as the activities pursued by self-employed people.

The right of establishment and the freedom to provide services are closely interrelated. The right of establishment enables a business to carry on an activity in another EU member state in the form of a branch or a subsidiary. 

We can provide expert advice on:

  • Any disadvantages that your current business structure might cause after Brexit
  • Potential changes to your group structure to allow the best possible market access to the EU after Brexit
  • Any potential changes to how VAT law, and other taxes, might impact your business after Brexit

Typical questions from our clients:

What are the consequences for cross-border services between the UK and the EU if the UK leaves the EU single market?

Some regulated industries, like the financial services industry, might be restricted from EU market access post Brexit. It might be required to set up a subsidiary entity in the EU to allow continued trade. 

Can a UK business continue to set up a branch or subsidiary in the EU after Brexit?

We are not aware of any restrictions to set up branches or subsidiaries in the EU post Brexit. We generally recommend undertaking any changes to the business structure before the transitional period ends so that there is no risk to trade continuing.

Will there be any significant changes to the UK’s VAT regime with regards to cross-border services?

If the UK leaves the EU single market and customs union after the transitional period ends, the UK will most likely not be part of EU VAT regulations. This does not mean that UK business can’t sell services into the EU anymore, however, certain simplifications won’t be applicable which might lead to additional VAT registration requirements in the EU.

The Four Freedoms of the European Union

Related insights

03 December 2021

Less than a month for EU businesses to claim UK VAT on costs incurred between 1 January 2021 and 30 June 2021

The following update from our International Outsourced Accounting team is relevant for EU-registered businesses who may have incurred UK VAT.

19 November 2021

HMRC Updates Border Operating Model

HM Revenue & Customs have released an updated Border Operating Model document to assist traders moving goods in and out the UK.

01 November 2021

The benefits of applying partial exemption special methods for private equity firms

Suzanne Beckett takes an in-depth look at partial exemption special methods and the benefits available to private equity firms.

Our experts

Alan Pearce
Partner

Alan Pearce

Partner

Alex Altmann

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