Cycle Scheme - how does it work?

[Sideways Rich]

I'm looking at reviving my 10 year dormant mountainbiking career! Does anyone know how the cyclescheme.co.uk initiative works and how to check if your employer is registered? I've found a bike that I like the look of and have seen that the shop advertises it as available under this scheme.

Thanks,
rich

[Magic919]

I think you'll need to ask your employer if they participate. The scheme pretty much works like it says on the website. Is there anything specific you need to know?

[Sideways Rich]

I guess the pertinent question is whether my employer participates or not?! Time to find out... Thanks

[DrMekon]

HMRC have just revised their guidance on final value payment from 5% to 25%. Proceed with caution. As someone who spent £1700 on a C2W bike (£2000 limit where I work), and didn't get the vat back, I suspect I am going to end up worse off than if I'd got an 0% deal. I am hoping that my work will take the common sense view, and just make me pay tax on the benefit of the 20%, but don't know yet.

[carreauchompeur]

Ouch. I hope the final value revision doesn't apply to existing agreements? Would mean an extra bill for me of £200!

[itsnotarace]

carreauchompeur said:

Ouch. I hope the final value revision doesn't apply to existing agreements? Would mean an extra bill for me of £200!

Yes it will

http://www.guardian.co.uk/lifeandstyle/2010/aug/13...

[Chicane-UK]

I'm a bit miffed by this. It's surely illegal for them to do this! I entered into my agreement expecting a final payment to be a nominal fee (5% as previously mentioned) but am now facing a more substantial bill. If I'd have known of the size of the final payment when I started, I would not have signed up as there are virtually no savings to be made any more.

I fully expected this to come, or the scheme to be axed entirely to be honest given how gleefully the Tories have gone around making cuts but I'd have at least expected existing participants of the scheme would be allowed to complete theirs under the agreement they originally signed up to. I'm due to finish payment of my current bike in a few weeks - talk about crap timing!

[itsnotarace]

5% final value after 1 year is pretty disproportionate to the actual value though

[carreauchompeur]

itsnotarace said:

5% final value after 1 year is pretty disproportionate to the actual value though

Fair comment, although it does seem a little disingenuous to apply this to existing agreements. Ho hum, the bike is still a blast and it's still a saving of sorts.

[anonymous-user]

My Cyclescheme.co.uk year was up about 3 weeks ago. I was slightly concerned after hearing scare stories. But on the completion date I had an Email asking for 5%+VAT of £500 to transfer ownership of the £500 cycle (That I had paid £251 for) to me. so I paid up there & then. They immediately sent me an ownership receipt etc. I have just entered into a new scheme for a £750 bike...

[blinkythefish]

I was going to submit invoice tomorrow. I'll need to check the small print again. At 25% it's probably not worth doing unless your on 40% tax, is it?

[Sideways Rich]

I'm yet to find out if my employer is registered for the scheme (will do this tomorrow) I've found the bike I'm after (subject to checking it's in stock) which is a Specialised FSR Pitch Pro (2009) at a reasonable price.

Aside from the residual value issue (25%) it still looks like it makes financial sense (40% tax payer).

[neilski]

itsnotarace said:

carreauchompeur said:

Ouch. I hope the final value revision doesn't apply to existing agreements? Would mean an extra bill for me of £200!

Yes it will

http://www.guardian.co.uk/lifeandstyle/2010/aug/13...

So under the old guidelines, if someone were to buy a bike for £1000 it would only be worth £50 a year later? Can someone please tell me where I can buy one of these bargain priced, 1 year old £1k machines?

[RobDickinson]

Havn they already paid 50% of the cost or something?

[Raven Flyer]

RobDickinson said:

Havn they already paid 50% of the cost or something?

No, under the scheme they have rented a bike for a year.

[OneDs]

Just seen this, the HRMC 25% is guidance and employers will have to choose what they go in at, but possibly have to make up the difference.

In my opinion the C2W has been a serious fk up from start and probably now finish. The launch was piss poor due to confusion on the ownership status and no clarity real costs/final payment, then the lack of employer take up, once Joe public realized the possible savings they pushed their employers to take it on, to the point where it is now so abused it's untrue, I regulary see people buying their kids BMX's and dirt jump bikes on this scheme. In an extreme case, I've seen someone flogging on their newly released (£1,000 when new) for £700 having not even been taken out of the box or fully completed the rental period, paying the monthly instalments making a healthy profit and then participating and doing the same the very next year.

The one thing that does concern me is that the intent was admirable and the pure numbers of people now cycling on decent spec bikes and enjoying it more because there not on a £50 asda special, and those who actually use a bike to commute to work year round who need two bikes and possibly a new one every few years, ie. those who are intended to benefit from the scheme will now seriously loose out.

In addition if the employee doesn't want the bike at the end of the year because they have to make a £250 final payment, WTF is the employer going to do with it?!?

Edited by OneDs on Tuesday 17th August 09:36

[Sideways Rich]

http://www.leisurewheels.co.uk/products.php?plid=m... - Just missed out on this bike - does anyone know if there is anyone out there holding stock of this bike (2009 model)?

Thanks,

[Justayellowbadge]

DrMekon said:

HMRC have just revised their guidance on final value payment from 5% to 25%. Proceed with caution. As someone who spent £1700 on a C2W bike (£2000 limit where I work), and didn't get the vat back, I suspect I am going to end up worse off than if I'd got an 0% deal. I am hoping that my work will take the common sense view, and just make me pay tax on the benefit of the 20%, but don't know yet.

O bks.

I've just been made redundant, and will have paid 6 months. The other 6 months will have to be paid at full value. Then 25% final?

It'll be more expensive than having bought it outright.

fksticks.

[Mr Will]

Justayellowbadge said:

DrMekon said:

HMRC have just revised their guidance on final value payment from 5% to 25%. Proceed with caution. As someone who spent £1700 on a C2W bike (£2000 limit where I work), and didn't get the vat back, I suspect I am going to end up worse off than if I'd got an 0% deal. I am hoping that my work will take the common sense view, and just make me pay tax on the benefit of the 20%, but don't know yet.

O bks.

I've just been made redundant, and will have paid 6 months. The other 6 months will have to be paid at full value. Then 25% final?

It'll be more expensive than having bought it outright.

fksticks.

The 25% is only guidance, the company can charge you whatever they like but you might have to pay tax on the difference between what they charge you and the "market value".

If they are try to make you pay 6 months full value plus the 25% I'd be tempted to say to them that it's their bike and they can keep it.

[Justayellowbadge]

Mr Will said:

Justayellowbadge said:

DrMekon said:

HMRC have just revised their guidance on final value payment from 5% to 25%. Proceed with caution. As someone who spent £1700 on a C2W bike (£2000 limit where I work), and didn't get the vat back, I suspect I am going to end up worse off than if I'd got an 0% deal. I am hoping that my work will take the common sense view, and just make me pay tax on the benefit of the 20%, but don't know yet.

O bks.

I've just been made redundant, and will have paid 6 months. The other 6 months will have to be paid at full value. Then 25% final?

It'll be more expensive than having bought it outright.

fksticks.

The 25% is only guidance, the company can charge you whatever they like but you might have to pay tax on the difference between what they charge you and the "market value".

If they are try to make you pay 6 months full value plus the 25% I'd be tempted to say to them that it's their bike and they can keep it.

The 6 months is contractural - no way out.

Unfortunately, they chose to have the voucher mob administer the disposal/final value bsuiness, so no wriggle room there.

What adds to the pain, is that in the case of redundancy, even though you have to pay all the remaining 'rent', you also have to pay the final value.

I'm paying rent for a year, I want to pay the final value at the end of that bloody year, not half way through on top of paying the rental in fking advance.

fksticks.