Salary Sacrifice
Discussion
but I'm thinking about a commuter tool here.As above, what are the details of the scheme?
Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
black-k1 said:
As above, what are the details of the scheme?
Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
I know there's point b) following it, but isn't money taken from pre-tax salary the very definition of 'salary sacrifice'?Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
mikey_b said:
black-k1 said:
As above, what are the details of the scheme?
Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
I know there's point b) following it, but isn't money taken from pre-tax salary the very definition of 'salary sacrifice'?Such things tend to only be worth while if the costs of buy/running the bike is coming from your salary before it's taxed, and any benifit in kind tax is less than the PAYE you would have paid on the salary.
If you own your own business then there are some significant advantages to the business providing you with a company motorcycle.
However, without the details of the exact offer neither of us can be sure it's a true "salary sacrifice" scheme and not just an inaproriately named scheme specific to that company.
It doesn't yet exist. I can (if I choose) take part in the NHS scheme but I'd prefer not to lose that much pension... which is why I wondered about bikes, and if they'd go for it.
In case anyone else looks at this thread later though, it doesn't make sense for a short distance private commuter: BIK is at 20%
https://www.rousepartners.co.uk/tax-on-company-mot...
Those using bikes for business miles (and not commuting) may find it makes sense though.
Right, I need another plan, it seems!
In case anyone else looks at this thread later though, it doesn't make sense for a short distance private commuter: BIK is at 20%
https://www.rousepartners.co.uk/tax-on-company-mot...
Those using bikes for business miles (and not commuting) may find it makes sense though.
Right, I need another plan, it seems!
Thanks for the update and I can see that, as an employee, where the deal is for the bike only, and your normal work base is the office you want to commute to, then it makes little sense.
Although, it sould be remembered that the 20% BIK assumes all the miles are personal miles. If 50% of the miles are "company miles" and 50% are personal then the BIK is 50% of 20%, thus 10%. The more business miles you add the less the BIK charge will be.
However, some of the advice you linked to for a company motorcycle does not align with my experience. Firstly, all my company bikes (5 since 2012) have been registered to me at my home address. I am the keeper even if the bike is owned by the company. The V5 is very clear about keeper and owner being different. Insurance is in my name (with business use) and all the servicing invoices etc. are in my name, paid for with my credit card but reclaimed as expenses from the company.
The company can also pay for all of the PPE needed to ride the bike and any training required.
While I don't want to tempt fate, I've not had any HMRC issues with this approach (approved by my accountant) and that has included a personal visit from HMRC to actually look at the "company asset" parked in my garage.
Although, it sould be remembered that the 20% BIK assumes all the miles are personal miles. If 50% of the miles are "company miles" and 50% are personal then the BIK is 50% of 20%, thus 10%. The more business miles you add the less the BIK charge will be.
However, some of the advice you linked to for a company motorcycle does not align with my experience. Firstly, all my company bikes (5 since 2012) have been registered to me at my home address. I am the keeper even if the bike is owned by the company. The V5 is very clear about keeper and owner being different. Insurance is in my name (with business use) and all the servicing invoices etc. are in my name, paid for with my credit card but reclaimed as expenses from the company.
The company can also pay for all of the PPE needed to ride the bike and any training required.
While I don't want to tempt fate, I've not had any HMRC issues with this approach (approved by my accountant) and that has included a personal visit from HMRC to actually look at the "company asset" parked in my garage.
^ Fair point, but very few of my miles would be for business. My business mileage is usually under 1k per annum now.
The training/kit contributions would be good, but not at 20% BIK. Like you said, for others it may make sense.
I find myself surprised that electric motorcycles aren't given a bit of a push with similar incentives to electric cars. I wonder how many (British built!) Maeving bikes might sell if salary sacrifice favoured greener power trains that aren't on 4 wheels.
The training/kit contributions would be good, but not at 20% BIK. Like you said, for others it may make sense.
I find myself surprised that electric motorcycles aren't given a bit of a push with similar incentives to electric cars. I wonder how many (British built!) Maeving bikes might sell if salary sacrifice favoured greener power trains that aren't on 4 wheels.
Edited by blearyeyedboy on Wednesday 2nd October 20:18
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