Make sense of Brexit with our jargon-busting glossary
Published 29 January 2019
Confused by Brexit? Our handy jargon glossary has got you covered.
We’re sorry to use the B-word. Really we are. But there’s one question on everybody’s lips - what will Brexit mean for your finances?
The truth is, nobody knows yet. So we’re not going to tell you if Brexit will make you better or worse off. Instead, we’re going to break down the Brexit jargon that you hear in the news every day.
Because regardless of whether we’re talking about Brexit or banking, we can’t stand jargon.
We’ll start with an easy one. Formed by combining the words ‘British’ and ‘exit’, Brexit is the process of the UK leaving the EU.
The European Union (EU) is a union of 28 countries, most of which are in Europe. The UK has been a member since 1973, and plans to leave the EU this year.
Article 50 outlines the process if an EU member wants to leave the EU.
Theresa May started this process in March 2017 by notifying the EU that the UK intended to leave. This meant that the UK could no longer contribute to any EU decisions, and set a two year timescale for agreeing a deal.
The European Economic Area (EEA) includes all 28 EU members, plus Norway, Iceland and Lichtenstein.
EEA members get to trade with EU member states through the single market, but they don’t have to adopt other EU laws.
The single market allows people, goods, services and money to move freely across the EEA.
So if you were a car parts manufacturer in Germany, the single market makes it easy for you to sell those parts to a garage in France.
A tariff is a tax paid on imported goods.
A customs union is where two or more countries agree to not put tariffs on each other’s goods.
The EU is a customs union, meaning that one member state can import goods from another without tariffs.
All EU member countries impose the same tariff on goods imported from elsewhere in the world (set by the EU).
A hard border is a border between two countries where immigration and customs checks might take place. Hard borders are usually staffed by the police, the military or customs authorities.
The backstop is the government’s proposed way to avoid a hard border in between the UK and Ireland.
The backstop keeps the UK and the EU in a customs union if they can’t agree a trade deal during the transition period.
If Theresa May’s deal gets accepted, little would change before December 2020.
This 21 month transition period allows time for the UK and EU to agree on what their future relationship will be.
The withdrawal agreement sets out the terms of the UK’s departure from the EU. It covers rights for EU citizens living in the UK and UK citizens living in the EU, how much the UK will have to pay the EU as a settlement, what will happen to the Irish border, and what the transition period will be.
No deal Brexit
In a no deal Brexit, the UK will leave the EU without an agreement in place.
If a no deal Brexit happened, the UK would cut ties with the EU at 11pm on 29th March 2019. There would be no transition period, and EU rules would stop applying in the UK straight away.
A no deal Brexit will happen if an alternative agreement hasn’t been reached by 29th March.
Some MPs and campaigners have called for a second referendum on the UK’s membership of the EU. This is often referred to as a People’s Vote.
Brexit and your money
Brexit might be confusing but your finances don’t have to be. With the thinkmoney Current Account, we’ll automatically budget for all your payments so you don’t need to worry about when everything is due.
So whatever happens with Brexit, we’ll be here to help you manage your money well. Open an account today for hassle-free banking.