Why UK small businesses are still struggling with post Brexit trade paperwork in 2025
Many UK small businesses hoped Brexit would open new markets. Instead, they’re finding that export paperwork, licences and customs complexity are still heavy burdens — limiting growth and competitiveness.
The UK officially left the European Union’s single market and customs union in 2020. Since then, many small and medium sized enterprises (SMEs) have found that exporting and importing goods, especially to and from Europe, involves far more paperwork, licences and regulatory friction than before. Despite government promises of simplification, the reality in 2025 remains challenging.
The scale of the issue
A House of Commons Library briefing shows that in 2024 UK exports of goods and services to the EU were £358 billion (41% of all UK exports), while imports from the EU were £454 billion (51% of total UK imports).
Source: House of Commons Library – UK EU Trade Statistics 2025
A European Movement UK survey of 1,100+ businesses (May 2025) found that 96.4% of respondents felt the post Brexit environment had a negative impact on their business or local economy.
Source: European Movement UK – Business Impact Report 2025
A 2025 report from Bibby Financial Services, Trading Places: UK SMEs Navigating International Trade, identified customs classification errors, tariff confusion, and FX risk as key barriers to growth.
Source: Bibby Financial Services – International Trade Report 2025
Key burdens for SMEs
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Customs codes and classification – Firms report delays and penalties for misclassification.
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Licences and export costs – UK firms spent up to £65 million on export licences for food and agricultural products in 2024 alone.
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Regulatory overlap – Exporters must comply with both UK and EU rules, creating duplication.
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Trade finance gaps – The International Chamber of Commerce UK warned that outdated trade frameworks are blocking around £22 billion in trade finance for SMEs.
Source: Financial Times – UK trade finance warning July 2025
Why this matters
For SMEs, higher export barriers mean lower competitiveness and slower growth. UK goods exports to the EU remain about 18% below 2019 levels in real terms, even as services exports have recovered.
Source: House of Commons Library – UK EU Trade Statistics 2025
What the government is doing
The UK Trade Strategy (July 2025) aims to make Britain “the best connected economy in the world,” promising better export advice and reduced red tape for SMEs.
Source: UK Government – The UK’s Trade Strategy 2025
The Small Business Strategy (September 2025) also acknowledges the burden of customs paperwork and pledges digital simplification and expanded export finance.
Source: Parliament – Written statement on Small Business Strategy 2025
What still needs to change
- Simplified customs codes and digital documentation.
- Tailored export support for SMEs new to international trade.
- Easier access to trade finance for smaller exporters.
- Better coordination between UK and EU regulators to avoid duplication.
The bottom line
Post Brexit promised new freedoms for UK businesses, but many SMEs say the reality is higher costs and more complexity. Unless export procedures are streamlined, the UK risks locking out thousands of smaller firms from global markets — and losing a vital source of innovation and growth.
References:
- House of Commons Library – UK EU Trade Statistics 2025
- European Movement UK – Business Impact Report 2025
- Bibby Financial Services – International Trade Report 2025
- The Guardian – Brexit export licences 2025
- Financial Times – UK trade finance warning July 2025
- UK Government – The UK’s Trade Strategy 2025
- Parliament – Written statement on Small Business Strategy 2025
