Cycle to work scheme?

[tillson]

You would think the Politicians would have some mercy on the little people doing their bit to save the planet .They give a £5,000 grant to buy a £30,000 car but nothing off for cyclists or E scooterists or even Motorcyclists under the previous discount scheme .Perhaps they think our machines are playthings !
Don`t get me started on paying £15 to tax my moped and plenty of cars are free .The latest Honda PCX 125cc Scooter with stop/start puts out 73 g / km of Co2 and if it was a car would be free , as it`s not a car it`s £15 .
If you can afford a £30,000 car , why should us taxpayers subsidise you ? Perhaps when the battery is knackered on the` Leaf `the taxpayer will fork out £14,000 for the replacement !

What you have to remember is that it has nothing to do with being green, saving the planet (snigger) or global warming (may / may not be happening). It makes a bit more sense if you do. If politicians were truly concerned about these matters, they would encourage cycling by giving incentives. The truth is, they aren't truly concerned, so they don't.

Perhaps we should all vote for St Lucas and her followers, we could power our vehicles from their self righteous glow and do away with fossil fuel altogether.

 

[Caph]

I'm not quoting dubious middlemen.

Apologies, you're quite right Walkerman. I wasn't aware of the new EIM21667a guidance. It wasn't mentioned in the DFT main guidance the last time I checked a few months ago so it must be a fairly recent change.

 

[HarryB]

Apologies, you're quite right Walkerman. I wasn't aware of the new EIM21667a guidance. It wasn't mentioned in the DFT main guidance the last time I checked a few months ago so it must be a fairly recent change.

August 2010 - shortly after the coalition took power.

 

[Caph]

Sorry to dredge this back up but having thought more about the C2W scheme this week it dawned on me how much this is a triumph of bureacracy over real world common sense.

Only a civil servant could dream up a scheme whereby the ethos is that the company buys the bike then sells it back to the employee, but if the company agrees in writing up front to this then it would be breaking the law.

Kafka was so on the money.

 

[PennyFarthing]

My place of work were very rigid - stating one bike shop only that we could purchase from. Very short-sighted of them.

 

[rayschooks]

My place of work were very rigid - stating one bike shop only that we could purchase from. Very short-sighted of them.

The whole thing seems more hassle than it's worth - especially when your place of work restricts your options even further. What possible reason could they have for insisting that you buy from a particular shop?
I have decided to forget about the CTW scheme all together.
I have bought my bike - paid the VAT and contented my self with the saving on fuel costs and the increase in my level of fitness.

 

[blather]

Congrats Ray
Did you get the Agattu?
My Pro connect Disc arrived last night, unfortunately couldn't use it to work this morning but will give its first long run tomorrow morning BEAUTIFUL bike!!
Here in the republic of ireland the CTW scheme is most certainly worth availing of, although I have heard of certain workplaces where they do restrict which shop you have to get it from, luckily this did not apply where i am.

 

[deadmonkey]

Maybe that's just as far as they've done the legwork thus far. Presumably someone in your firm has to do some admin per shop, hence it's easier and more cost effective for larger companies. For a smaller company they added that one shop, probably because that's the one somebody wished to use or they made it quite straightforward?

I'm just saying that the level of enthusiasm behind the scheme will vary from workplace to workplace, which I guess is an unfortunate consequence of it needing buy in from our employers?

 

[JuicyBike]

Under CTW the bikes belong to the employer

Legally bikes purchased under this scheme belong to the employers, who hire them to their employees and so no VAT is paid (no VAT is paid for anything that is hired).
This employer may be taking that ownership seriously and deciding to purchase from just one supplier, which could be argued as sensible for the employer, but restrictive for the employee.

 

[Mussels]

August 2010 - shortly after the coalition took power.

But it had nothing to do with the coalition government, the tax man had been trying to get it changed for some time.

Before this change I decided the savings were minimal compared to the benefits of buying it myself so I stopped pestering my company to adopt the scheme.

 

[HarryB]

But it had nothing to do with the coalition government, the tax man had been trying to get it changed for some time.

Before this change I decided the savings were minimal compared to the benefits of buying it myself so I stopped pestering my company to adopt the scheme.

Of course just a coincidence No it was a reasonable system before with good savings but as you say now not worth bothering with.

 

[deadmonkey]

The latest Honda PCX 125cc Scooter with stop/start puts out 73 g / km of Co2 and if it was a car would be free , as it`s not a car it`s £15 .

Doesn't that sound fairly modest compared to a Polo, small Seat or one of the other small eco cars which weigh 10 times as much and can carry 4 people plus luggage for only 20-30% more emissions?

It looks very tidy though

2011 Honda PCX Review - Motorcycle.com

Incidentally, I never even looked at the economics of the cycle scheme, I just used it because I didn't want to shell out for my Kalkhoff in one lump some, so if there's any vat or tax benefits that will be a bonus.

 

[deadmonkey]

HarryB this is from the link you posted:-
7. Some employees were expecting to pay 5% plus VAT; why must they pay more now?
HMRC have defined what the transfer values must be. By following Cyclescheme’s recommended option (entering into an extended use agreement) your savings are protected. You may end up paying less, or a maximum of 1% more. Here are the savings you make using the old and new process:

 

[HarryB]

HarryB this is from the link you posted:-
7. Some employees were expecting to pay 5% plus VAT; why must they pay more now?
HMRC have defined what the transfer values must be. By following Cyclescheme’s recommended option (entering into an extended use agreement) your savings are protected. You may end up paying less, or a maximum of 1% more. Here are the savings you make using the old and new process:

Because you don't have ownership for 4 or 5 years! Personally I don't want to keep a bike that long and have always sold my electric bikes before they lose most of their value*. I don't like the way they changed the procedure in the middle of my second contract as I would never have entered into said contract had I known. I would say that the original scheme was a lazy bit of legislation but in fact they were too damn lazy to pass any legislation in the first place. It was typical Gordon Broon and sort of explains that is why it has ended up the way it has!

*Typically the main objective has been to get people commuting on their bicycles but most bikes would be pretty knackered well before 4 or 5 years if they did the day in day out cycling that I do with my commute.

PS Please bear in mind you are not supposed to do a "top up" on your bike though many bike shops will do this. Many of the better electric bikes will cost more than £1000 anyway and it seems a bit of a risk doing a top up if they are taking such an interest in final valuations (impossible of course with a "top up" electric bike where they have separated the battery/lights from the main bike). On top of that many of the electric bike shops will add £50-100 for this top up (knowing of course that you cannot complain about it!) so the savings over 4 or 5 years look a pretty miserable £50 - £75 a year.

 

[PennyFarthing]

The whole thing seems more hassle than it's worth - especially when your place of work restricts your options even further. What possible reason could they have for insisting that you buy from a particular shop?
I have decided to forget about the CTW scheme all together.
I have bought my bike - paid the VAT and contented my self with the saving on fuel costs and the increase in my level of fitness.

I can only assume ridigity of thought and simplicity of admin/payroll.

 

[Pedalo]

Because you don't have ownership for 4 or 5 years! Personally I don't want to keep a bike that long and have always sold my electric bikes before they lose most of their value*. I don't like the way they changed the procedure in the middle of my second contract as I would never have entered into said contract had I known. I would say that the original scheme was a lazy bit of legislation but in fact they were too damn lazy to pass any legislation in the first place. It was typical Gordon Broon and sort of explains that is why it has ended up the way it has!

*Typically the main objective has been to get people commuting on their bicycles but most bikes would be pretty knackered well before 4 or 5 years if they did the day in day out cycling that I do with my commute.

PS Please bear in mind you are not supposed to do a "top up" on your bike though many bike shops will do this. Many of the better electric bikes will cost more than £1000 anyway and it seems a bit of a risk doing a top up if they are taking such an interest in final valuations (impossible of course with a "top up" electric bike where they have separated the battery/lights from the main bike). On top of that many of the electric bike shops will add £50-100 for this top up (knowing of course that you cannot complain about it!) so the savings over 4 or 5 years look a pretty miserable £50 - £75 a year.

Just been thinking through possibilities. The well known workarounds are to wait 5 years before transferring ownership or to transfer ownership as a benefit in kind. The benefit is taxable but it still works out less than paying the full fair market value.

Alternatively, I was wondering, with paying the employer an extra 25% of the value of the bike after one year, they are effectively that money better off on the whole deal. Is there anything stopping them reducing the rental price of the bike by that amount across the year?

 

[HarryB]

My view is that the 5 year work around doesn't really work for me for the above reasons - might work for many who are happy to make the committment to 4 or 5 years ownership at minimal savings per year. Also I am not sure they are able or even allowed to enter any sort of deals like this - it is pretty well bound up in regulations.

 

[DBCohen]

What my company are doing is charging a single lease payment as a deposit at the end of the cyclescheme period, which is returned at the end of the overall agreement - meaning that no final value costs are incurred.

They do this because otherwise, at the end of the salary sacrifice, you would be well within you rights to return the bike to the employer and walk away - it is theirs, after all. They do NOT want people doing that, and end up with the hassle of bike disposal.

And I don't recognise the calculations from the Cyclescheme website - it is well known that the various savings in Cyclescheme add up to a roughly 50% overall saving, especially with VAT at 20%. And that still makes sense to me.

 

[Pedalo]

The transfer of ownership at any time as a benefit in kind is certainly allowed.
It's documented better than I can explain it here:

Evans Cycles | Ride2Work | Transfer of Ownership Options

What I don't know is if the employer has any flexibility with the rental charges. Like you say it's probably bound up in the regulations but can anyone confirm this?

 

[HarryB]

What my company are doing is charging a single lease payment as a deposit at the end of the cyclescheme period*, which is returned at the end of the overall agreement - meaning that no final value costs are incurred.

.

* What period are you talking about?