Cycle to work scheme increased to unlimited

New Topic
This topic has been archived, and won't accept reply postings.

I was just told that the govt are increasing the cycle to work scheme to unlimited value so i did some intenetting and found this

https://www.cyclescheme.co.uk/cycle-to-work-scheme-any-price

Seems it's not being adopted widely just yet due to some ambiguities in the wording, but it would be amazing if it is widely adopted. Does anyone know anymore about it?

Personally it would cost me approx £45 for every £100 spent, so a £4k bike would cost me around £150 a month for 12 months. 

Actually, now I'm thinking about it...this could be very dangerous

Post edited at 16:03
 thepodge 19 Aug 2019
In reply to Bjartur i Sumarhus:

But after a year a 4k bike isn't going to be worth £0 so you'd still have to pay the residual value. Remember that it's no longer a loan that you have to pay off, it's a hire scheme with potential benefits at the end. 

In reply to thepodge:

The way I understand it is that I pay for it out of pre tax salary sacrifice. Hence only costing me approx £45 deduction in my salary for every £100 paid back. So if I chose a £4K bike, I would pay it back in full over 12 months but pre tax deduction. My take home pay would be reduced by £150 a month so it effectively only costs me £1800 but the full £4K has been paid. Then my company wrote it off and let me keep it. 

Edit. Ok it seems the rules have changed since my colleague used the facility. The tax loop hole has been closed so there is a final payment of some kind as you say. Hmm more research required on my part....

Post edited at 19:57
 Phil Lyon 19 Aug 2019

£1k not enough for a commuter bike?

What's the most expensive bike primarily used by someone to regularly cycle to work, as per the scheme's intention?

1

In reply to 

its to accommodate e bikes which are more expensive I believe

 LastBoyScout 19 Aug 2019
In reply to Bjartur i Sumarhus:

I looked into the BtW scheme for my last bike and concluded it's more grief than it's worth - you need to pay it off over 4 years to get the maximum tax benefit, you don't own it until then, your employer does and if you move jobs, you'll have to pay it off sooner and lose much of the benefit.

So I bought a new bike in a sale and got 40% off that way.

I could have got another chunk off the sale price with BtW, but I'm planning on leaving this job in the next 6 months.

 Donotello 19 Aug 2019
In reply to Phil Lyon:

It’s still your money. Its not like a free bus pass for school. They’re helping you buy a bike by spreading out the cost, you should be able to buy whatever bike you choose.

Clearly that’s been realised hence the update. 

 Ridge 20 Aug 2019
In reply to Donotello:

> It’s still your money. Its not like a free bus pass for school. They’re helping you buy a bike by spreading out the cost, you should be able to buy whatever bike you choose.

It's not spreading the cost, it's providing a tax break - ostensibly with the proviso that it's providing a less polluting alternative for commuting. It could be argued it's tax avoidance, or the tax payer is subsidising your hobby

Post edited at 05:53
 Donotello 20 Aug 2019
In reply to Ridge:

I think we can all agree we’d rather our tax subsidising hard working peoples cycling hobby than subsidising an M.P’s duck pond or a lay-abouts new PlayStation 7 

 gethin_allen 20 Aug 2019
In reply to Bjartur i Sumarhus:

On a £1000 bike I saved about £150 using the BtW scheme.

I probably could have found the same bike on sale for the same.

The scheme is pretty regressive imo in that higher rate tax payers are able  to benefit more when they are the ones who are perfectly able to buy a bike from their own pockets. 

 Dave B 20 Aug 2019
In reply to Phil Lyon:

£900 (was 1000) + £200 of accessories and £300 of clothes... Its 19 miles each way... So only 2 or 3 days a week. 

If I got an ebike I'd get the ribble gravel bike in at £2300... That would make me cycle more often... 

 thepodge 20 Aug 2019
In reply to Bjartur i Sumarhus:

Remember you have to pay full RRP on bike to work too (or at least you are supposed to) so often an interest free credit card and a bike in the sale will often work out similar cost. 

Also note that your employer has to pay full price for the bike upfront too, although there are financing options available, my last two places of work refused to be involved with b2w as they couldn't afford to offer it to all staff. 

Post edited at 08:16
In reply to thepodge:

Just spoken to a colleague who purchased a BMC bike from Evans last year through the scheme.

1) The bike was reduced on the shop floor from £1600 to £1100 in a sale to all and sundry

2) Colleague buys bike and Evans gave my colleague £100 for his old bike

3) £1000 balance arranged on the scheme

12 months later ( 2 months ago ) colleague receives email from Evans saying that contract is finished and to choose one of three options

A) Extended hire agreement (free - no extra payment required)

B) Pay fair market value and own the bike

C) Return the bike

He chose A) and here is the email he received

Hello XXX,

Your end of scheme hire agreement has been processed. You are now enrolled in 'Option 1 the free extended use hire agreement'.

There is no further action for you to take. You will receive a yearly email giving you the option to buy the bike at that year’s fair market value cost, however you are more than welcome to ignore those and automatically stay enrolled in Option 1.

You may apply for another ride to work voucher if you wish!

Thank you for being a customer of Evans Cycles, we appreciate your business.

Kind Regards,

XXX
B2B Administrator

In reply to thepodge:

He then received another email from Evans showing the FMV amortisation over 6 years (25% - zero) with the following message

Dear XXX,

This is confirmation that you have entered into your 60 month Hire Agreement with Evans Cycles which allows you to use the bike free of charge.

If you wish to take ownership of the bike during this hire agreement you can do so by making a payment based on the HMRC fair market valuation guidelines. To calculate what this payment would be please see the table below.

Don’t forget that you can also apply for another Ride to Work certificate

Regards,

The Evans Cycles Ride-to-Work Team

 neilh 20 Aug 2019
In reply to Bjartur i Sumarhus:

I ditched our company scheme. It was a nightmare to admin and my accountant wasted too much time administering it.

Unless they really get to grips with the admin then it will never really take off as it should.

My accountant still has recurring nightmares about the admin ( along with BT phone bills, but that is a different story)

 felt 20 Aug 2019
In reply to Bjartur i Sumarhus:

Why not avoid the faff and get that 4k bike for 2k when it's last year's model?

 thepodge 20 Aug 2019
In reply to Bjartur i Sumarhus:

In that case either the rules have changed or Evans broke the rules. 

When I was selling bikes it was full RRP only.

1
Nempnett Thrubwell 20 Aug 2019
In reply to thepodge:

Hi, i'm curious as to whether the scheme is achieving it's underlying aim - just about everyone I know who has used the scheme have used it to purchase a further bike to the 1/2/3 they already have - or at the very least to upgrade their commuting bike.

When you were selling bikes - how many people looking to purchase through the scheme wanted to buy a non-commuter bike - eg a full-susser or a track bike as opposed to a workhorse commuter bike with panniers / full mud guards etc?

 LastBoyScout 20 Aug 2019
In reply to thepodge:

> In that case either the rules have changed or Evans broke the rules. 

> When I was selling bikes it was full RRP only.

The rules have changed to include sale bikes.

In reply to felt:

I suppose one advantage is you don't have to find £2k to buy the bike upfront. I suppose you could use a credit card and balance transfer to a zero rate. 

As it happens, my firm restricts the scheme to Evans cycles, and as I demonstrated above, if a 2018 bike is half price, i can buy that on the scheme, saving another ~ 55% as they do not restrict it to latest model RRP bikes

In reply to Nempnett Thrubwell:

Using myself as an example, if my firm allow the unlimited purchase price I will be buying a weekend dream machine piece of exotica and will continue commuting on my trusty 10 year old alu framed work horse.

 the sheep 20 Aug 2019
In reply to Bjartur i Sumarhus:

Last bike I got on the scheme was a nice commute bike around the 1K mark. However as this is still going strong, if I were in a position to use it again I would go for a very nice road bike instead. 

 LastBoyScout 20 Aug 2019
In reply to Nempnett Thrubwell:

It's been open to abuse since day 1, if you can find a sympathetic bike shop.

I know several people that have never once cycled to work on a bike bought through the schemes, or, indeed, on any bike at all - one of them bought a full-suss downhill rig and drives to the office, another (who is home-based) a mountain bike and a couple of others that have bought high-end carbon frames masquerading as full bikes.

On the other hand, why shouldn't I use it to upgrade my commuting bike (which is basically what I've just done, although I also use the bike for club runs and other errands), to make my journey easier/quicker/more comfortable.

Unfortunately, it would be massively difficult to police whether people are actually using it in the way it is intended.

My wife's office, for example, doesn't have anywhere to lock a bike up, let alone showers or changing facilities and is a hideous journey by bike from our house, unless you take a massive detour. On the other hand, she's used her bike for lots of local errands that she would otherwise have used the car for.

 galpinos 20 Aug 2019
In reply to Nempnett Thrubwell:

As a sample of 1 I have just bought a bike* specifically to commute to work, drop the girls at school and cycle around my local area (shopping etc). It's a steel frame with middle of the road groupset, mudguards, a pannier rack and now has an old kiddie seat on the back. I have gone from driving to work to biking to work more than I drive. We shall see whether my resolve lasts through the winter!

I do have a mountain bike in the shed.

*reduced sale price plus CTW tax relief has made it pretty cheap, far cheaper than any discount I have seen elsewhere.

Nempnett Thrubwell 20 Aug 2019
In reply to LastBoyScout:

As mentioned earlier - it seems the scheme is just helping to fund peoples hobby of bike upgrading - and supporting the bike retail industry in doing so - You can get a perfectly serviceable commuting bike for very little these days, and as mentioned above - if electric bikes are now achievable in the scheme then the fitness and zero emissions benefits are also distorted.

I'm sure the overall cost to the treasury is peanuts compared to other expenses - but would diverting those funds to better public transport have a greater impact on car numbers??

1
 thepodge 20 Aug 2019
In reply to Nempnett Thrubwell:

> Hi, i'm curious as to whether the scheme is achieving it's underlying aim - just about everyone I know who has used the scheme have used it to purchase a further bike to the 1/2/3 they already have - or at the very least to upgrade their commuting bike.

> When you were selling bikes - how many people looking to purchase through the scheme wanted to buy a non-commuter bike - eg a full-susser or a track bike as opposed to a workhorse commuter bike with panniers / full mud guards etc?

I've never used the C2W system (I'm self employed so I'm excluded from it) but my posh bike gets used for more miles and hours than my commuter so if the aim is to get people out and about then it would make sense to use it for a new posh bike. 

When I was selling bikes we'd sell people a basic mountain bike for sub £500 but we'd also sell people a £1000 set of wheels... they got told off for selling the wheels under C2W. 

 Toccata 20 Aug 2019
In reply to LastBoyScout:

> I know several people that have never once cycled to work on a bike bought through the schemes

Guilty. C2W has part-funded my MTB habit for years and I have never once used to bike to cycle the 130 mile round trip. I have spent many hours cycling though.

Whatever the intentions it’s good political capital even if it seems just to be a very handy tax dodge for high earners.

Post edited at 17:40
In reply to Bjartur i Sumarhus:

My employer runs their own scheme and I think it is excellent. I purchased a Trek mountain bike through the scheme, a new model, and will end up paying around £1700 for a bike that retailed for £2600 when I got it. The bike shop gave a 10% discount to our scheme before any tax savings were taken into account. I 'rent' the bike for 18 months paying about £1100, then make a final payment of £600 to transfer ownership to me. And not only do I sometimes ride my Trek Remedy to work, I frequently use it in my work too.

 steve taylor 21 Aug 2019
In reply to Bjartur i Sumarhus:

The last time I used CtW (8 years ago), it paid for a very nice Garmin, thanks to my local Halfords... 

 Dave B 21 Aug 2019
In reply to Nempnett Thrubwell:

Not necessarily true. 

Electric bikes get people riding who would otherwise drive, and get prior cycling further, hence doing more exercise.

The was a report about it recently. Probably linked on road.cc if you want to look

 spenser 21 Aug 2019
In reply to Dave B:

It's also worth noting that cyclists usually don't obstructother road users in busy periods as they filter on the left hand side so e bikes still offer that advantage.


New Topic
This topic has been archived, and won't accept reply postings.
Loading Notifications...