This is a useful read: The cost of no deal
So the possible outcomes are not as simple as, to coin a well-known phrase, “deal or no deal”. Indeed, it is possible to identify (at least) four broad scenarios, as follows:
• Smooth Brexit. All goes according to plan. We manage to have both the Article 50 and the trade deal signed, sealed and delivered by March 2019; with, where required, agreed transitional arrangements to ensure implementation is smooth.
• Transitional Brexit. The Article 50 deal is agreed. Discussions begin on a trade deal and are progressing well, or at least have not broken down; so both sides agree on transitional arrangements, or at least some sort of standstill provisions where little or nothing changes, in order to bridge the gap to a full deal.
• Cliff-edge Brexit. The Article 50 deal is agreed, but the trade discussions go nowhere: either they break down, or they have made little progress. So there is nothing to transition to. Meanwhile continuing the UK’s Single Market membership and/or free movement is unacceptable to one or both sides. So on March 29, 2019 the UK becomes a “third country”, with no special relationship of any kind with the EU. WTO rules will apply to the UK’s trade with the EU.
• Chaotic Brexit. There is no Article 50 agreement within the two year period, and no extension. The talks fail, because of disagreement over citizens’ rights, the role of the ECJ, money, or perhaps some other issue we haven’t yet focused on. On Brexit Day, the UK ceases to be a member of the EU – but, politically and legally, all the outstanding issues remain unresolved. Meanwhile, as in the case of a “cliff-edge” Brexit, the UK will become a third country with respect to the rest of the EU. There are two ways in which such a “chaotic Brexit”, might come about.
A premature Brexit would see talks break down acrimoniously, and the UK deciding unilaterally to stop paying its EU contribution and end the supremacy of EU law in the UK with immediate effect. While unlikely, it is possible to see political dynamics conspiring to bring this kind of outcome about.
A timed out Brexit, where the talks don’t completely break down, but no agreement is reached within the two year period, and there is no extension.