Brexit - a never-ending story is coming to an end

Anyone who has business relations with the UK is certainly asking themselves one question at the moment:
Deal or no-deal!

December has now arrived and the time until the UK’s final exit from the EU is very short. However, due to the question posed above, it is not so easy to analyze the impact of this divorce on your SAP system and make the appropriate arrangements.

However, from today’s perspective, you can make some considerations about your planning and look at the 2 possible scenarios:

If a deal is struck, the UK will no longer be part of the European Union, but will remain part of the enlarged European Economic Area (EEA). Change requirements in SAP will then become somewhat clearer. For example, tax law in the EEA states largely corresponds to EU directives.

However, if there is a no-deal, the UK will become a third country and this will have all kinds of serious consequences that will also have to be taken into account in the SAP system.

To prepare for this worst-case scenario, you should take a closer look at your processes and business transactions in your SAP system and draw up a checklist of the necessary changes. Here are some examples of areas in SAP that you should examine and evaluate:

General settings

The country settings for the UK must be adapted to the new conditions. This area is cross-module and therefore very important.

FI for your financial management and tax determination

In FI, you are faced with the challenge of adapting all future tax law aspects in order to work in compliance with the law. You have to check and change tax numbers and account data, take new cost factors such as more expensive bank transfers into account in calculations and planning. New tax codes will be required and, in the worst case scenario, a completely new VAT system will need to be configured if the UK opts out of the EU’s VAT Directive and introduces its own system.

Customer and supplier master data

First of all, you should take a close look at who you do business with in the UK and to what extent. Previously, these transactions were possible without any problems in the EU internal market. In future, however, this supplier or customer will belong to a third country. Changed tax requirements, new customs duties, export and import regulations lead to requirements in the master data in SAP.

MM for materials management and purchasing

If you purchase goods from the UK, you have to deal with the status of the suppliers concerned and change the declaration of goods that will no longer come from the EU but from a third country in other processes. You need to make arrangements with the supplier and, if necessary, handle the import declaration yourself. You must also take your open orders into account in

SAP MM. You should also check whether it is not better to postpone orders to January in order to minimize the number of open business transactions to be processed.

SD for sales and distribution

New customs forms will apply for Great Britain from 01.01.2021, which must be created in SAP SD and linked to the corresponding customers. Delivery times and delivery dates must be aligned with new, more lengthy customs processes. In addition, the calculations in the system must be revised to reflect the new framework conditions.

PP for production planning and control

If you produce in the UK, you need to change production location details in the system. There may be very close links to the settings in FI here, e.g. new VAT numbers.

CRM for Customer Relationship Management and GTS for Global Trade Services

Of course, areas such as CRM and GTS are also affected. If you do not use these in SAP, you must check the existing interfaces to your SAP system to ensure that all changed settings, including in the master data, are harmonized in the systems and match again.

If you have any questions or require support with the necessary adjustments, please do not hesitate to contact us.