MORE than 20 per cent of companies in Yorkshire are worried that leaving the European Union would cause a significant hit to their bottom line, new findings show.

According to insolvency trade body R3, Brexit and the challenges of the new national living wage are the main concerns of regional businesses.

It found that 21 per cent of businesses are worried that Brexit would have a significant financial impact on them, against 23 per cent nationally.

Dealing with the national living wage is a major concern for 20 per cent of firms - below the UK average of 18 per cent.

The introduction of auto-enrolment pensions is a concern for 17 per cent of regional firms.

Other business worries include the introduction of quarterly tax reporting; the digitalisation of tax reporting and the introduction of an Apprenticeship Levy.

Chris Wood, Yorkshire R3 committee member and partner at Clough Corporate Solutions in Cleckheaton, said: “The possibility of leaving the EU is playing on the minds of a significant number of business decision-makers.

“Uncertainty over such an important issue could well affect investment and planning decisions over the next few months. Generally, levels of business confidence and economic optimism are holding up though.

“Although the Brexit debate is grabbing the headlines, it’s important to remember that businesses face a plethora of other incoming regulatory and compliance challenges. Just as many businesses in Yorkshire are worried about the new national living wage as are worried about Brexit.

“And while Brexit might not come to pass, the national living wage and auto-enrolment pensions will definitely have to be dealt with by businesses.”

The research also found that 43 per cent of regional businesses expect activity to increase in the next 12 months, with only three per cent expecting a decrease, while 55 per cent of Yorkshire businesses are more optimistic about the economy now than they were three months ago, with 20 per cent more pessimistic.

Chris Wood added: “Although, overall, the vast majority of businesses do not have any Brexit concerns, almost half of the largest employers are worried about the prospect of leaving the EU. Similarly, the worries about the national living wage are far more acute for the smallest employers.”

“UK businesses have enjoyed a period of rapid growth, boosted by low inflation and low fuel costs. However, as well as slowing economic growth, businesses will have to contend with a range of new compliance and reporting burdens in the next few years. This could put some businesses’ finances under significant pressure.”