How freelancers and contractors can get ready for Brexit

With the 31st December deadline just days away, there is still a great deal of confusion over what exactly life will be like once the UK has exited the transition period. This uncertainty, coupled with the inherent diversity of those in self-employment, means there is no ‘one size fits all’ approach when it comes to preparing for Brexit. Ultimately freelancers working with EU clients will now have to comply not just with one EU-wide set of working rules but with each country’s particular guidelines, which may take some research. Below we highlight some of the key areas of concerns for freelancers and how you can be prepared come January. 


Business travel to the EU after Brexit

Perhaps the most obvious change that will impact anyone traveling to the EU concerns the end of freedom of movement. From January 1st you can travel to most EU countries for up to 90 days in any 180-day period without a visa for purposes such as tourism. You will need your passport to both have at least 6 months left and be less than 10 years old (even if it has 6 months or more left).

For business travel – which could include activities such as travelling for meetings and conferences, providing services, and touring art or music – you will need to check if there are any extra entry requirements such as visas or work permits for the country you’re visiting. For instance, if you are working on a longer term contract, depending on who your client is, you may have to pay into social security abroad, instead of National Insurance, and inform HMRC using the form CA3837. You will also need a ‘Portable Document A1’ as proof.

Everyone, including businesspeople, will then have to apply for a European Travel Information and Authorization System (ETIAS) visa waiver for €7 for travel to the continent starting in 2022.

Lasty, if contracting in the EU and countries such as Switzerland in the EEA, there are likely to be changes to your EHIC health card. You can find more information about this on the NHS website here

Selling services into the EU

Put simply, UK businesses and professionals selling services into the European Economic Area (EEA) will no longer be treated as if they were local businesses. You will have to comply to each country’s rules when selling, details of which can be found at gov.uk/transition. Again, there are some key areas to think about.

First, if you have specific accredited UK qualifications and are looking to work and provide services in the EU, you will need to check these are recognised in the country you are looking to work into.

Second, there may be new rules on data transfers and protection if you or your business sends personal data to the EU from January 1. Unless the EU decides whether they accept that the UK’s data protection regime is still adequate, you may need to take actions such as getting Standard Contractual Clauses (SCCs) in place to keep data flowing lawfully.

Third, there may be some loss of future IP protection if the UK and EU are unable to agree reciprocal arrangements. If your business owns Intellectual Property (IP) rights such as trade marks, patents, designs or copyright we suggest you review any agreements you have in case these need clarifying or updating post-transition. Finally, if you have used a .eu domain name to supply services in the EU, this will no longer be usable after December.

Tax and trading

Another area of concern to many freelancers who contract with clients in the EU concerns tax, particularly VAT. If you have been paying VAT on work in the EU through the Mini One Stop Shop (MOSS) system, you will have to reapply and register for MOSS in an EU member state from January 1st.

If your self-employed business trades goods, rather than services, into and out of the EU, the government recommends you consider how to deal with customs declarations and register for an Economic Operators Registration and Identification (EORI) number.

There are many other key points that will be worked out in the coming weeks (unfortunately giving freelancers little time to prepare) which may affect their work and contracts with EU clients. So far, government has done precious little to support freelancers through this process and that is why IPSE has argued they should do much more to simplify the process for the self-employed, for example with a support hub and dedicated advice.

An end to uncertainty?

Brexit uncertainty has hampered many businesses over the last four years. Data from our Confidence Index has highlighted the difficulties caused by this uncertainty - investment decisions have been put on hold and freelancers’ confidence in their business has been negatively impacted. More than one in three (39%) freelancers had at least one project or contract based in the EU prior to the pandemic, illustrating the importance of this issue to the sector. There are clearly major issues on the domestic front which continue to plague freelancers – IR35 and Covid certainly spring to mind – but we hope that we might next year begin to move away from Brexit uncertainty and towards a position of growing confidence amongst freelancers.

Meet the author

Alasdair Hutchison

Policy Development Manager