To c2w or not to c2w...

[RhythMick]

After a lot of research I'm down to choice of 2 bikes. Both are cx bikes - not planning to enter any cx events, but I want something that can be fast on the roads, tough enough to take the trails and with drop bars.

The Boardman cx team is £899 and I can get it through my employers c2w scheme so around 40% off. Have to wait till December but that's OK.

If I had a straight choice I'd go for the Planet X Uncle John at the same price. Can't get it through c2w though.

Anyone think the PXUJ is worth the extra £300 or so?

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[Cubist]

Are you sure? If your employer has bought into the Halfords C2W scheme, they will usually source any bike for you. My job has done the same this year, and Halfords have undertaken to get any make other than direct competitors (and of course the manufacturers who won't play with Halfords. )

 

[MGBLemonrider]

I currently think* the C2W is a bit of a con as the advantages aren't quite what they're advertised as.

Picking up on a couple of points you post. You're expecting a 40% saving , you'd be hard pushed to get that. firstly you'd have to be a higher rate tax payer and then it depends on what your employer does at the end of the hire period. Most periods seem to be set at 1 year so if your employer deems it fit to sell the bike to you it depends on what level they sell it to you at. Anywhere between the HMRC fair price of 25% of retail value and nothing, anything less than the HMRC price and you'd be liable for the tax advantage. Therefor purchase price effectively ranges £225 down to £90. So total purchase price will in effect be between £746 and £612. If you pay tax at 20% will be £906 - £792.


The problem being your employer can tell you what their intention is. Most aren't in the business of selling 2nd hand cycles, but can you grantee that they won't gather up all the cycles and sell them off as a job lot or make a charitable donation, after all they're their bicycles.


Assuming that the employer has some interest in staff good will the only way to extend the hire period untill they sell the cycle on to you so that it's fair price becomes negligible.

I might be totally cynical and twisted but I'd rather establish a good relationship with my lbs and perhaps make savings on service and the odd discount.

*from my understanding - I could be totaly wrong.

sorry ramblimg drunk posting.

 

[Dave Crampton]

My administrator Cycle Scheme says that for a small fee (around £10 - £15) they extend the hire period to 3 years, after which the value of the bike reduces (as per the HMRC website) to a low single digit figure. You pay no further monthly payments of money after the first year, which is when they offer of the extended hire period is given to you. Otherwise you would be looking to pay ~25% of the initial value to buy the bike.

But this all depends on who you're employer is. I haven't found an employer yet you is interested in taking the bike off the employee, and really only wants to off the scheme as a added benefit to their employees as part of their compensaton package. Its just more admin for their HR/finance depts.

I have heard/read that Halford administored scheme can 'in theory' source any model under £1000 but I think you may pay a small admin fee for them to source the bike.

FWIW, I have chosen a CX bike. The Cotic >X< as it has disk brakes, is a UK company, and were mainly an MTB specialist.

 

[TheBoyBilly]

I think the C2W scheme still has it's merits. The savings may not be so good now but I think they are still substantial. Cycling Active magazine has an article about it this month so have a read of that before making up your mind. My employer deferred ownership for nothing so that I will only pay a nominal fee after 3 or 4 years. It's my Brompton in all but name.

Bill

 

[Norm]

Cyclescheme is a commercial organisation, created to exploit the tax benefits who will take as much as they can from you. Employers may not be interested in taking the bike rather than extending the loan, but the same cannot be said of Cyclescam.

Cycling Active appears (from what I've read) not to do anything journalistic themselves but to believe the words of Cyclescam, even when they are wrong and very obviously self-contradictory.

Other things to be aware of is that the bikes are not yours until the final payments, and HMRC, your employers or Cyclescam may change any of the rules at any time. You can also not have any more than two bikes with a total new price over £1k at any time, unless your employer has a consumer credit licence.

The C2W regulations still allow individuals savings of up to 50%, if they are members of company schemes which are set up to take maximum advantage of the benefits. Employees of companies which use Cyclescheme will, if they are on basic rate tax, probably get a similar deal by going to their LBS and paying cash or getting a low-interest loan, and they will own the bike from the outset, without being tied in to working for the same employer for the contractual rental period.

 

[Edge705]

check out my post here https://www.cyclechat.net/

It pretty much sums up the C2W schemes - IMHO its probably worth doing if your gonna stick to the same company for the full 3 years and ONLY IF you are at least the 20 percent tax payer otherwise its of no real use.

Basicaly a £1000.00 bike is gonna save your employer about £110 quid in NI savings (£1000 - VAT * 13.8%) 13.8% repressents Class 1 NIC rates for employers I understand so it can be worthwhile to them However the savings you make depend on the tax you pay and what the charges are for the scheme

One things for absolute certain you will never make a 40 percent saving unless your a 40 percent tax payer !

 

[Norm]

check out my post here http://www.cyclechat..._1#entry1811368

Your post there is wrong. The rules on VAT have changed, there is no maximum or minimum rental period, you make no mention of the option to purchase at the end of the rental period (at the "recommended" rates now published by HMRC), there is no cap on the benefit, subject to the consumer credit licence.... etc

 

[CopperCyclist]

I've recently bought a Boardman CX Team on the cycle to work scheme, and with the new rules what the above poster says it true, I'll save VERY little - I did my maths and if its 40 quid I'm lucky. I do however essentially get aninterest free loan to pay it off over a year.

The bike is a great bike, I'd highly, highly recommend it. I did have a few problems with Halfords not knowing what they are doing, but hey, thats a whole other thread - the bikes great.

If you are looking at the Boardman purely to save money, make sure you pretty much consider that you'll be spending the full 900 on it anyway. With the components Boardman is putting on his frames, all his bikes are great value anyway, and hard to turn down.

 

[RhythMick]

I've recently bought a Boardman CX Team on the cycle to work scheme, and with the new rules what the above poster says it true, I'll save VERY little - I did my maths and if its 40 quid I'm lucky. I do however essentially get aninterest free loan to pay it off over a year.

The bike is a great bike, I'd highly, highly recommend it. I did have a few problems with Halfords not knowing what they are doing, but hey, thats a whole other thread - the bikes great.

If you are looking at the Boardman purely to save money, make sure you pretty much consider that you'll be spending the full 900 on it anyway. With the components Boardman is putting on his frames, all his bikes are great value anyway, and hard to turn down.

HSBC scheme takes payments over 12 months, final payment at 3 years so minimal final tax. I'm a 40% tax payer. So it seems to stack up.

Spoken to P2X. They don't take Halfords vouchers but take Bike2Work. HSBC only issue Halfords. Spoke to the Halfords c2w team. They've had lots of requests for PX but can't supply and no intention of changing.

So I reckon the P2X will cost me about £300 more and all in one go. The fact that I'm still considering it shows how much I think of it.

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[rsvdaz]

HSBC scheme takes payments over 12 months, final payment at 3 years so minimal final tax. I'm a 40% tax payer. So it seems to stack up.

Spoken to P2X. They don't take Halfords vouchers but take Bike2Work. HSBC only issue Halfords. Spoke to the Halfords c2w team. They've had lots of requests for PX but can't supply and no intention of changing.

So I reckon the P2X will cost me about £300 more and all in one go. The fact that I'm still considering it shows how much I think of it.

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My wife is HSBC so we looked at their scheme for a new bike for her...there is no mention of an option to purchase the bike at the end of the hire agreement..only a £100 fee for handing it back! what with the forthcoming VAT changes and the uncertainty of actually getting the title of the bike at the end of the agreement we decided against the scheme and purchased the bike ourselves

 

[mrmacmusic]

Unfortunately C2W wasn't an option for me, so I shopped about the various local bike shops and ended up getting a nice discount on a Ridgeback Flight that was in stock.

However, a conversation I had in one of the shops (which I won't name) put me right off not only them, but made me think about the C2W scheme in general. It went something like this...

Me: "What's your best price on that 2010 Trek 7.5FX then?" (RRP, and more expensive than the Trek sale price on a new one at the time!)
Assistant: "The price on the ticket. We don't need to discount bikes because someone who knows nothing will come in with £1K to spend under cycle scheme and he'll say I'll just have that one."

I know business is business and all that, but I was very surprised at that attitude... needless to say, I spent my money elsewhere.

 

[RhythMick]

Checking with HR now.

PX pass on a 10% fee levied by the schemes they do work with. No issue with that. To be honest this is all just convincing me more that PX are excellent value already.

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[Edge705]

Your post there is wrong. The rules on VAT have changed, there is no maximum or minimum rental period, you make no mention of the option to purchase at the end of the rental period (at the "recommended" rates now published by HMRC), there is no cap on the benefit, subject to the consumer credit licence.... etc

Wrong? what all of it? which part and would you care to elaborate Ive been into great detail about two schemes CTW and Cyclescheme however clearly I have mis interpreted their advice. Perhaps you could clarify?

Even so based on my advice to a work colleague he is now seeing bottom line deductions within a £1 based on my advice he also had to pay an admin fee to the bike shop because they said that's what they get charged by the scheme so he was a further 10 percent out of pocket However the shop did make this clear to him before he got his bike.

 

[primalgeek]

The C2W regulations still allow individuals savings of up to 50%, if they are members of company schemes which are set up to take maximum advantage of the benefits.

I'm being pedantic here, but this is wrong. There is no requirement for the employer to recoup the cost of the bike from the employee during the course of the agreement (source: see references to 'salary plus' at http://www2.dft.gov.uk/pgr/sustainable/cycling/cycletoworkguidance/). Additionally the company does not have to make the 25% charge at the end of the scheme (assuming a 1 year scheme). This can optionally be treated as a benefit in kind and taxed appropriately. In this ideal world the benefits could stack up to way more than 50%.

Obviously this ideal world isn't open to everyone. However it is a common route for v. small / one man band limited companies.