Cycle to work - £1000 limit

[danrc]

I am looking to get a bike through the C2W scheme. It looks like my limit is £1000 and have come across this one:

http://www.alpinebikes.com/shop/hardtail/trail-sl1...

Is it any good? What other options are there?

Any recomendations?

Thanks for your input!

[Comfortably Dumb]

Hi Dan,

I was recently in the same situation as you and got some great advise from the guys in here, but you're going to need to give a little more information about what type of riding you're going to do if you want meaningful feedback.

CD

[danrc]

Comfortably Dumb said:

Hi Dan,

I was recently in the same situation as you and got some great advise from the guys in here, but you're going to need to give a little more information about what type of riding you're going to do if you want meaningful feedback.

CD

Thanks for the reply CD.

To be honest it will be a mix or road (commuting), weekend riding to parks/up hills and some offroading. I'll be doing more commuting later in the year as my fiance is moving office so instead of driving i'll just cycle on from her work. I'll also be doing more cycling as I am trying to get fit for the impending wedding!

How good a deal is the C2W scheme? I've seen mixed reviews on here and by having a look through google.

Thanks again
Dan

[hullbilly]

Be careful with spending that amount on the C2W as with the new structure set out by HMRC its not as cost effective anymore.

[Comfortably Dumb]

hullbilly said:

Be careful with spending that amount on the C2W as with the new structure set out by HMRC its not as cost effective anymore.

True, the numbers need to be looked at carefully. Same bike same model year it will work out cheaper, however last years model or second hand might offer better value.

If your using it mostly on raod/cycle paths you might want to consider a hybrid with skiny tires. I went for a Kona Dew Deluxe hybrid and am very happy with it.

[danrc]

Are there any up to date guidelines available? I've had a look over lunch and there seems to be a lot of conflicting information.

Thanks again CD, what I had planned was to either have 2 sets of wheels (One for parks/offroad) and the other for roads and commuting. Either that or I get some good tyres like the goodyears that are out just now with a low rolling resistance. My friend has a pair and swears by them.

[okgo]

The long an short of the scheme is it will cost you 7% of the bikes value as a final payment, apart from that its exactly the same.

[Gnarlybluesurf]

danrc said:

I am looking to get a bike through the C2W scheme. It looks like my limit is £1000 and have come across this one:

http://www.alpinebikes.com/shop/hardtail/trail-sl1...

Is it any good? What other options are there?

Any recomendations?

Thanks for your input!

Similar spec for half the price, though the cannondale is slightly better you probably wouldn't notice it.... that said with the price difference you could wear out the obvious bits of the rockrider and buy new parts to make it closer to the Cannondale and still be under £1000.

http://www.bikeradar.com/gear/category/bikes/mount...
http://www.decathlon.co.uk/EN/8-1-2011-172069577/

Similar spec different brand £559 if medium is your size not many left of last years design

http://www.bikeradar.com/gear/category/bikes/mount...
http://www.halfords.com/webapp/wcs/stores/servlet/...

Better spec:
http://www.halfords.com/webapp/wcs/stores/servlet/...

Last year and this year with this year having better gearing..

http://www.halfords.com/webapp/wcs/stores/servlet/...

Best to be honest what you will be using it for mainly and try to suit it to this... if you're never going to take it properly off road you'll appreciate a cyclocross / hybrid / racer style much more for road use.

hope this helps

[Bonefish Blues]

swerni said:

okgo said:

The long an short of the scheme is it will cost you 7% of the bikes value as a final payment, apart from that its exactly the same.

No, before you owned the bike after 12 months with a potentially negligible payement.
Now to get the same deal you have to keep the bike and the job for 6 years.

Not quite HMRC table here: http://www.hmrc.gov.uk/manuals/eimanual/eim21667a....

[911p]

Specialized Rockhopper Comp 2011.

[Bonefish Blues]

swerni said:

That table says after 6 years the payement on a £1000 bike is negligible which is exactly what I said.

Which bit is " not quite"?

Apologies, I misread your post as referring to the 7% residual rather than the "negligible" one.

[okgo]

swerni said:

No, before you owned the bike after 12 months with a potentially negligible payement.
Now to get the same deal you have to keep the bike and the job for 6 years.

You don't.

I've asked at length and spoken to many people about this.

Its 12 months payments, then 7% if you get a £1000, then there is a 3 year period in which you can move employers if you want as the contract is with cyclescheme not your employer.

So basically after 12 months, you own it again.

Well I was given 3 options, and the first one, which most people are doing is the loophole to get the bike almost half price.

I've got it in writing and they said that they were happy for me to keep the email as proof.

Edited by okgo on Wednesday 20th April 09:36

[okgo]

From cyclescheme themsevles :

This is option 1 of the three that you now get offered after the 12 months payments are up :

" Under a separate agreement with Cyclescheme, pay a small refundable deposit (3% or 7% of the certificate value*) and continue to use the bicycle for 3 years. The monthly payments are zero. At the end of this period, Cyclescheme refund the deposit if the employee does not wish to keep the bicycle. No further action or payment is required if they wish to keep the bicycle."

That seems fairly conclusive to me? 12 months payments, 7% of total value, keep for three years, yours.

Can leave employment after 12 months as its with them not the employer, and you can do another scheme after 12 months too.

[okgo]

Are cycle to work and cyclescheme different ????

This might be why we are arguing...

[CoolC]

I'm trying to persuade my employer to run the C2W scheme, but the HR chap keeps telling me there is now a 25% payment to be made at the end to "own" the bike. I'm looking at ~£600 bikes and being a 20% tax payer that seems to add up to chuff all saving in the end. But if I'm understanding you correctly there is only a 7% payment at the end as long as you don't change employers within so-long (which I have no plans to do)

Is it a case of delaying the final payment by years or paying and signing an agreement that you will pay the extra if you move employer?

I'm getting more confused the more I read.

[Bonefish Blues]

CoolC said:

I'm trying to persuade my employer to run the C2W scheme, but the HR chap keeps telling me there is now a 25% payment to be made at the end to "own" the bike. I'm looking at ~£600 bikes and being a 20% tax payer that seems to add up to chuff all saving in the end. But if I'm understanding you correctly there is only a 7% payment at the end as long as you don't change employers within so-long (which I have no plans to do)

Is it a case of delaying the final payment by years or paying and signing an agreement that you will pay the extra if you move employer?

I'm getting more confused the more I read.

I'm in HR, and have been trying to convince my colleague who is launching the scheme to adopt this approach - without success.

They are paranoid we will end up with people walking away, leaving us with 2nd hand bikes, hence the insistence on purchase after 12 mths, with attendant 25% residual payment

[okgo]

I don't think they are, both the scheme and HR at work are saying indentical things...

[BalhamBadger]

Interestingly, my previous employer offered up to £4,000 on the cycle to work scheme. Quite a significant benefit to be had there. Can anyone beat that? I'm guessing the person that pushed it through was a keen cyclist!

[okgo]

swerni said:

You win.

They're right and HMRC are clearly wrong


Have you not thought that HR are getting the information from the people running the scheme?

So looking at the table, I'm not wrong?

1 year of paying for the bike + 3 more years = 4 years which = 7% like I said?

[Mr Will]

Bonefish Blues said:

CoolC said:

I'm trying to persuade my employer to run the C2W scheme, but the HR chap keeps telling me there is now a 25% payment to be made at the end to "own" the bike. I'm looking at ~£600 bikes and being a 20% tax payer that seems to add up to chuff all saving in the end. But if I'm understanding you correctly there is only a 7% payment at the end as long as you don't change employers within so-long (which I have no plans to do)

Is it a case of delaying the final payment by years or paying and signing an agreement that you will pay the extra if you move employer?

I'm getting more confused the more I read.

I'm in HR, and have been trying to convince my colleague who is launching the scheme to adopt this approach - without success.

They are paranoid we will end up with people walking away, leaving us with 2nd hand bikes, hence the insistence on purchase after 12 mths, with attendant 25% residual payment

The best option, from the employees point of view at least, is to be given the bike free of charge by the employer. The bike is then judged by HMRC to be a benefit in kind of the value set out in the table, so the employee must pay extra income tax on that amount.

i.e. £1000 bike, given to employee after 1 year. HMRC says that the bike is a BIK worth £250 so the employee must pay an extra £55 income tax (assuming 22% tax band).

No other payments, no extended agreement and the employee has full ownership of the bike. It is my belief that this is what HMRC were intending when they changed the rules.

The big cycle scheme operators have gone for a much more complicated system to justify their own existence, but it does work and as the ownership is transferred from employer to scheme operator after 12 months, the employee is able to change jobs after this point and is not stuck with the same company until the loan of the bike finishes.

Finally, to those saying "Just buy a bike in the sales", there is nothing to stop you using a C2W voucher to buy a bike in the sales and saving money twice.