WHAT'S THIS CYCLE2WORK SCHEME?
Discussion
Here's an example:
http://www.wiggle.co.uk/CustomerServices/cycle2wor...
Basically, though, you get an interest free loan from your employer which you pay back by taking a salary sacrifice, thus saving the income tax and NI from the amount you borrow. If you're in the 40% zone, this can be a substantial saving.
http://www.wiggle.co.uk/CustomerServices/cycle2wor...
Basically, though, you get an interest free loan from your employer which you pay back by taking a salary sacrifice, thus saving the income tax and NI from the amount you borrow. If you're in the 40% zone, this can be a substantial saving.
As I understand it your employer buys a bike (and offsets the vat) and then you use the bike to get to work making repayments from your gross salary.
Therefore, you get the bike you want less the vat, less the National Insurance and less the income tax.
Therefore if you buy a bike for £1000 you end up actually only paying £552.64.
(less the vat is 1000/117.5%=851.06, less the National Insurance is 851.06/110%=773.69, less the income tax is 851.06/140%=£552.64)
Therefore, you get the bike you want less the vat, less the National Insurance and less the income tax.
Therefore if you buy a bike for £1000 you end up actually only paying £552.64.
(less the vat is 1000/117.5%=851.06, less the National Insurance is 851.06/110%=773.69, less the income tax is 851.06/140%=£552.64)
yes it all adds up to a bike costing only about 50% of what it would...plus there's no actual proof required that you do ride to work.
I bought my latest road bike through this scheme and my commute is too long to ride to work. A friend has so far bought a new Mountain bike, new road Bike and new time trial bike for himself plus a new hybrid for his wife all through the scheme....(mind you he is chairman of his company!!)
I bought my latest road bike through this scheme and my commute is too long to ride to work. A friend has so far bought a new Mountain bike, new road Bike and new time trial bike for himself plus a new hybrid for his wife all through the scheme....(mind you he is chairman of his company!!)
Marcellus said:
there's no actual proof required that you do ride to work.
Technically you need to ride at least part of at least 50% of your work journeys but as you say, there's no requirement to keep a log or anything so proving otherwise would be nigh on impossible (unless you have a company car log that could be used to show you driving for more than 50% of the time?)So say i bought a Santa Cruz heckler for say 2400 because i would need to tackle a few mountian passes before i got to work (naturally 
)how much could i save? Is there different schemes depending on which compnay you work for?
When i worked for the MoD in AbbeyWood things there seemed very restrictive etc
i've sent a email to my HR person to see what benifits there are and more importantly what i could choose from (i know back at AbbeyWood there was a requirement to buy from HalfordsB2B scheme?)
)how much could i save? Is there different schemes depending on which compnay you work for?When i worked for the MoD in AbbeyWood things there seemed very restrictive etc
i've sent a email to my HR person to see what benifits there are and more importantly what i could choose from (i know back at AbbeyWood there was a requirement to buy from HalfordsB2B scheme?)
pdV6 said:
It's all down to the scheme run by your company - many tie themselves to schemes such as Halfords' one to simplify administration.
There is usually an upper limit of £1000 for the loan as above that your company needs to have some licence for credit or something.
ah i see, might only be able to get the frame then.... honest gov its the new way to ride your bike without wheels and handle bars and...... lolThere is usually an upper limit of £1000 for the loan as above that your company needs to have some licence for credit or something.
Yes, the cost to the employer needs to come in under the upper limit, so if the limit is £1000 then you can get something that retails for £1175 as the employer recovers the VAT.
Of the remaining £1000, you pay it back via salary sacrifice, which would mean hitting your pocket for £590 as a higher rate earner or £667 as a lower rate tax payer.
Oh, and I was wrong about the £1 thing earlier. Apparently HMCE are using 5% as a 'fair value', so it would be £50 in the above example.
Of the remaining £1000, you pay it back via salary sacrifice, which would mean hitting your pocket for £590 as a higher rate earner or £667 as a lower rate tax payer.
Oh, and I was wrong about the £1 thing earlier. Apparently HMCE are using 5% as a 'fair value', so it would be £50 in the above example.
CooperS said:
all elementary really 
can only go to halfords for my bike, which gives me Kona and umm Kona unless i went for a high-end GT but company caps at 1k so no point really.
Oh well cheers for the advice guys
Not true!! can only go to halfords for my bike, which gives me Kona and umm Kona unless i went for a high-end GT but company caps at 1k so no point really.Oh well cheers for the advice guys
You can source your bike through any participating shop and tell Halfords. They may not like it, but they are obliged to get it for you.
I know this to be true as I have a friend who works for cyclescheme.... Halfords just do not advertise the fact
The jiffle king said:
CooperS said:
all elementary really can only go to halfords for my bike, which gives me Kona and umm Kona unless i went for a high-end GT but company caps at 1k so no point really.
Oh well cheers for the advice guys
Not true!! can only go to halfords for my bike, which gives me Kona and umm Kona unless i went for a high-end GT but company caps at 1k so no point really.Oh well cheers for the advice guys
You can source your bike through any participating shop and tell Halfords. They may not like it, but they are obliged to get it for you.
I know this to be true as I have a friend who works for cyclescheme.... Halfords just do not advertise the fact
Barreti said:
I'm due to get made redundant 31st December and approached my HR dept to find out if I could still participate in this scheme. They said it would be better to just buy it from Halfords and get the discount they offer. Is this true or are they just being their usual lazy arse self?
As the bike remains the property, or an asset, of the company until your final payment then I doubt they would want to do this. Wait and get it through your next employer.
It may be obvious from above postings but you're not limited to a bike costing 1000 quid it's just that you will have to pay the balance out of your own pocket. I am also told that the revenue limit you to one bike per tax year so not sure what mr director will be doing come April 08.
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