C2W Scheme - minimum number of payments?

[Norm]

The full details of the rules are on the DfT's site.

On this particular subject, they say...

There is no fixed time period for which cycles and cyclists' safety equipment must be loaned under a Cycle to Work scheme. Similarly, there is no fixed time period for which a salary sacrifice scheme must run where one is used to offset the cost of loaning the cycle and cyclists' safety equipment.

etc etc

There is information there about the rights to ownership and the issue of the fair market value. Better make sure you treat the bike like crap so it's worth half of nothing after a year.

 

[g00se]

Hi,

They stock folders (it's a small shop) and have a few higher end road and touring bikes - I can't recall the makes. They build bikes to order too and I imagine they can order some in. Give them a call - they're a very friendly lot.

 

[colinr]

There is information there about the rights to ownership and the issue of the fair market value.

It all gets a bit vague at that point, only that it shouldn't be a tax benefit. My leaflet says 5%, how is that possibly fair market value after 1 year? Sounds like a tax benefit to me!

They build bikes to order too and I imagine they can order some in. Give them a call - they're a very friendly lot.

If there's one thing I've learned this year, it's that Norwich has an absolute shedload of bike shops

 

[g00se]

If there's one thing I've learned this year, it's that Norwich has an absolute shedload of bike shops

it's not like it used to be - when I was a student here, there were at least another half dozen back-street LBSes. Though some where definitely a bit dodgy - and would sell you back a bike that you had nicked a few months previously.

 

[gazmercer]

I've just recently applied for the C2W scheme where I work. The max amount of the loan is £800 payable over 3, 6 or 12months and they only use Halfords. The £800 is for the bike and accessories but after you've paid for it, it's yours. There is mention of a 15% discount but I think that only applies to Halfords brand bikes (Apollo for example) as I am going for the Boardman Comp 09 and have been informed that Boardmans are not part of the scheme.

To be honest it seems to be up the employer as to what rules and regulations they follow. The promo leaflet in work doesn't mention any savings other than the 15% discount for Halfords.

 

[Flying Dodo]

Don't forget if you do want to pay it back over just 1 month, you can't let your net salary, for the hours worked in that month, drop below the National Minimum Wage (now £5.80/hour).

 

[colinr]

The maths works based on gross figures but I've no idea how I'd calculate it as net.

 

[Flying Dodo]

Assuming you work 9-5 with an hour for lunch, so you're being paid for 154 hours in October, after repaying the bike cost, your net salary on which you then pay tax & NI would have to be at least £893.20.

 

[mr Mag00]

http://www.wiggle.co.uk/h/option/cycletowork#4

i found this quite helpful actually

 

[colinr]

your net salary on which you then pay tax & NI

If it's before tax and NI that's gross isn't it?

I'm still waiting for a reply from Cyclescheme but I'll probably take a wander into the shop at the weekend and see if they can come up with a plan. They make a sale if they do (assuming work then agree to it), so should be helpful

http://www.wiggle.co.uk/h/option/cycletowork#4

http://www.wiggle.co.uk/h/option/cycletowork#4

Again, with this bit:

There is no definitive guidance on calculating fair market value for bikes and cycle accessories. Values of approximately 10% of the original cost are being used. The Inland Revenue review cases on their individual merits. If a value of 10% is used and the Inland Revenue deem that it should be higher then this will result in a benefit in kind for the employee.

So you have to make up a 'fair value' and hope the tax man agrees? Even on a 3 month scheme, 10% seems incredibly low, I might be better off just buying it the old fashioned way!

 

[Flying Dodo]

If it's before tax and NI that's gross isn't it?

I'm still waiting for a reply from Cyclescheme but I'll probably take a wander into the shop at the weekend and see if they can come up with a plan. They make a sale if they do (assuming work then agree to it), so should be helpful



Again, with this bit:

So you have to make up a 'fair value' and hope the tax man agrees? Even on a 3 month scheme, 10% seems incredibly low, I might be better off just buying it the old fashioned way!

It's not quite gross, as that's your normal salary. With the salary sacrifice (the amount being used to buy the bike), that's deducted off your gross salary, and then that figure is used as your new monthly salary on which tax & NI are deducted.

I'd agree that there's no way you'd get away with 10% as the value after 3 months, which is why trying to do it over a short period doesn't make as much sense financially.

 

[colinr]

Cyclescheme say:

Dear Sir / Madam... (know any girls called Colin?)

I would like to advise you that the Hire Period has to be for a minimum of 12 months, however the payment period can be set for a shorter period than that. So you can set the Hire Period for 12 months but make the repayment period 1 month if you wish. You would then have to wait for the Hire Period to elapse before you can make the Fair Market Value payment to transfer the ownership.