Cycle scheme, the final 'nominal charge'

[satans worm]

Looking to take up the cycle scheme where by I was advised I need to buy the bike back from the company for a 'nominal fee' at the end, when I pushed them on this they said the nominal fee was infact between 6-10pct of the purchase price.
To me that seems rather steep, an additional gbp100 on a gbp1000 bike?
I know of 2 other companies doing the same thing, one charges a fiver for what ever bike they had, the other nothing, just write off the bike.
What are other companies charging on this scheme?

[pdV6]

It can be whatever they damn well like really. You never own the bike, the company does. You just lease it for a year.

iirc HMRC indicate that a write-down to 5-10% of the original cost in a year is acceptable.

[Gazzab]

Be careful to not be made redundant as they could ask for the bike back and you will have made n months (at say £50 a month).

[WildCards]

Gazzab said:

Be careful to not be made redundant

Always sage advice is that.

[Gazzab]

WildCards said:

Gazzab said:

Be careful to not be made redundant

Always sage advice is that.

Pleasure ;-)

[fergus]

Gazzab said:

Be careful to not be made redundant as they could ask for the bike back and you will have made n months (at say £50 a month).

I think you'll find that it got stolen just after you were told, and you only need to repay them the balance of the 'loan'....

[prand]

My company made me pay 5% of the new value of the bike which did surprise me as I thought they were going to ask fro something a bit more nominal. So it was £50 for me. Added to the 10% "administration and handling fee", this ate into the bargain element of buying a new £1000 bike somewhat.

However, knowing I was repaying this tax free, and for once I was getting something back from Greedy Gordon made it worth it.

[P-Jay]

My old company (RBS) didn't ask for a penny, which is odd because as a finance company they should have known that there needs to be something paid to transfer ownership. (or proof of scrapping).

Glad it ran out before my redundancy. Got a lovely bill for ending my RBS staff mobile contract early of £135, yes I had to pay the remaining 6 months worth of monthly "line rental" charges AND they cut me off.

[anonymous-user]

a friend has to pay 5% as the final charge...

[cheshire_cat]

P-Jay said:

My old company (RBS) didn't ask for a penny, which is odd because as a finance company they should have known that there needs to be something paid to transfer ownership. (or proof of scrapping).

Glad it ran out before my redundancy. Got a lovely bill for ending my RBS staff mobile contract early of £135, yes I had to pay the remaining 6 months worth of monthly "line rental" charges AND they cut me off.

You had to pay the remainder of your company mobile contract? That sounds utterly bizzare! (unless you'd racked up a large personal amount of calls?)

Surely the phone would belong to the company at all points, and you wouldn't be liable for anything?

ETA:
Our company manages it's own Bike to Work scheme, and simply divides the bike price by 12, then takes that from your gross pay each month. Nothing to pay at the end of the term.

Edited by cheshire_cat on Friday 12th June 14:13

[P-Jay]

cheshire_cat said:

P-Jay said:

My old company (RBS) didn't ask for a penny, which is odd because as a finance company they should have known that there needs to be something paid to transfer ownership. (or proof of scrapping).

Glad it ran out before my redundancy. Got a lovely bill for ending my RBS staff mobile contract early of £135, yes I had to pay the remaining 6 months worth of monthly "line rental" charges AND they cut me off.

You had to pay the remainder of your company mobile contract? That sounds utterly bizzare! (unless you'd racked up a large personal amount of calls?)

Surely the phone would belong to the company at all points, and you wouldn't be liable for anything?

ETA:
Our company manages it's own Bike to Work scheme, and simply divides the bike price by 12, then takes that from your gross pay each month. Nothing to pay at the end of the term.

Edited by cheshire_cat on Friday 12th June 14:13

Nah, I did have a company phone which I just returned (well I returned A phone, the last handset I had was quite nice, so I nicked it).

I also had a private phone I bought through an employee discount thing. It was called RBSelect, you could get all sorts of stuff on it, discount holidays, child care, healthcare, B2W, RBS shares at a discount £2ish (current value c40p) and many many more weird and wonderful things. The fees usually came out of your wages and there were loads of tax and NI savings.

Sadly unless you retire they stop the moment you leave and they take the surrender fee out of your final salary. Luckily I saw the way the wind was blowing at the last renew date so I cut everything except the mobile. Even though it was all done via an outside company called Flexphone and you paid them direct they deleted me, had to pay all the line rental charges I would have paid if they hadn't laid me off, without the benefit of actually having the line.
I hear that the whole thing is being scrapped, along with final salary pension. The VERY generous maternity and paternity pay.

AND they took 2 flavours of drinks out of the 'coffee' machines AND the flavoured options out of the Brita machines!! And implemented a very strict set of guidelines setting up, under pain of dismissal, if and when you could order catering for meetings (both customer and internal) 2 hours for tea and coffee, 4 hours for Tea, Coffee & biscuits! 6 hours+ Sandwiches.

[satans worm]

P-Jay said:

cheshire_cat said:

P-Jay said:

My old company (RBS) didn't ask for a penny, which is odd because as a finance company they should have known that there needs to be something paid to transfer ownership. (or proof of scrapping).

Glad it ran out before my redundancy. Got a lovely bill for ending my RBS staff mobile contract early of £135, yes I had to pay the remaining 6 months worth of monthly "line rental" charges AND they cut me off.

You had to pay the remainder of your company mobile contract? That sounds utterly bizzare! (unless you'd racked up a large personal amount of calls?)

Surely the phone would belong to the company at all points, and you wouldn't be liable for anything?

ETA:
Our company manages it's own Bike to Work scheme, and simply divides the bike price by 12, then takes that from your gross pay each month. Nothing to pay at the end of the term.

Edited by cheshire_cat on Friday 12th June 14:13

Nah, I did have a company phone which I just returned (well I returned A phone, the last handset I had was quite nice, so I nicked it).

I also had a private phone I bought through an employee discount thing. It was called RBSelect, you could get all sorts of stuff on it, discount holidays, child care, healthcare, B2W, RBS shares at a discount £2ish (current value c40p) and many many more weird and wonderful things. The fees usually came out of your wages and there were loads of tax and NI savings.

Sadly unless you retire they stop the moment you leave and they take the surrender fee out of your final salary. Luckily I saw the way the wind was blowing at the last renew date so I cut everything except the mobile. Even though it was all done via an outside company called Flexphone and you paid them direct they deleted me, had to pay all the line rental charges I would have paid if they hadn't laid me off, without the benefit of actually having the line.
I hear that the whole thing is being scrapped, along with final salary pension. The VERY generous maternity and paternity pay.

AND they took 2 flavours of drinks out of the 'coffee' machines AND the flavoured options out of the Brita machines!! And implemented a very strict set of guidelines setting up, under pain of dismissal, if and when you could order catering for meetings (both customer and internal) 2 hours for tea and coffee, 4 hours for Tea, Coffee & biscuits! 6 hours+ Sandwiches.

I used to work for them 2 years ago so I know your pain!

[ClassicMercs]

I have just finished setting up our own self administered scheme - great for talking discounts on the purchase with local retailers.

My lads are all working on 'no more than 5%' as that's often referred to.

HOWEVER - I know my local council does 3% and I hear that the NHS trust is doing likewise. I am getting evidence.

If that's the case we will be doing 3% and showing the tax man my evidence, if he wants to call. You can't argue with 'public sector' policy being different to private sector.

As an employer we don't want to charge - the bikes stand us at nothing. The final charge is just profit and we didn't set up the scheme to make a profit. But - we will. After admin costs we will save £1,000 over £10,000 of bikes - but the lads, me included, save much more.

[Kermit power]

ClassicMercs said:

As an employer we don't want to charge - the bikes stand us at nothing. The final charge is just profit and we didn't set up the scheme to make a profit. But - we will. After admin costs we will save £1,000 over £10,000 of bikes - but the lads, me included, save much more.

I don't suppose there's anything preventing you just turning straight round and blowing that £1,000 on some sort of staff jolly, is there?

[satans worm]

Kermit power said:

ClassicMercs said:

As an employer we don't want to charge - the bikes stand us at nothing. The final charge is just profit and we didn't set up the scheme to make a profit. But - we will. After admin costs we will save £1,000 over £10,000 of bikes - but the lads, me included, save much more.

I don't suppose there's anything preventing you just turning straight round and blowing that £1,000 on some sort of staff jolly, is there?

Or charity?

[Mekon]

I am in the uni sector, and our uni is umming and ahhing over the setup of a scheme - they've been told 2.5% is the norm (apparently they got this info off cyclescheme.co.uk), but that "the tax man" is starting to think that the low level of nominal charge means employees are getting a benefit that's going untaxed, and as such, the nominal charge needs to be made more "believeable".

[Benny Saltstein]

My company (on the Evans scheme) will be relieving me of £1 as the final nominal charge on my Brompton. There certainly seems to be some inconsistency if some are paying £50, some 2.5%.

Certainly, I try and take advantage of as many of these salary sacrifice schemes as possible. I'm hoping I can buy another Brompton and flog the current one on ebay.

[bennyboysvuk]

The company I work for currently understand the final fee as the 'market value' of the bike. If it was sold for less than that then it is seen as a benefit in kind which means that the tax then has to be paid for.

The only way that this makes any sense is if I don't pay for the bike for a few years and then the company sells it to me, at which point market value, particularly if the thing is well used could be as low as £50-100.

How are other companies successfully getting away with 5% of the original cost? Has that been questioned at all?

[Nick_F]

I think 5% is HMRC's own recommendation, isn't it?

[mackie1]

What's the situation with taking up the offer twice? Could I take it up again immediately after my final payment? I quite fancy getting a nice roadie next.