Cycle to work scheme - +

[doyler78]

Just been to do the deed. Will be picking up my Trek 1.5 double later this afternoon. I've got some spd pedals fitted, some new shoes and a wireless computer. Bring on tomorrow morning for the first ride!!

Congrats - I'm sure you will love it however tomorrow - have you seen the weather - gales where I am don't know about you.

 

[Downward]

It may seem strange to say this but I wouldn't be happy not have paid for it at the end as effectively you still do not own the bike as the company cannot waive the payment. At the end of the hire period the company owns the bike and has therefore got an asset. They can of course decide to do with the bike what they want and the only rules regarding disposal are in relation to the employee him/herself as to how the sale should be conducted. They of course do not have to sell the bike and can continue to allow you to just use the bike however it's not yours. What happens if you leave?

Hi
Your Company won't have an asset at the end of the 12 month Lease.

The purpose of leasing a bike of say £1k over buying a bike over £1k is to avoid the Capital costs. The company wouldn't be able to lease you a bike anyway even if bought through capital so they would just end up with say x amount of bikes for the staff to use (they couldn't charge you)while not only paying the purchase price but also paying 10% for the capital costs (depreciation)

There is clear guidelines that state the Cyclescheme is a leasing scheme and there is no purchase taking place. This is because the company's you and I are working for would have to obtain credit licences or something as if they let you buy a £1k bike over 12 months it's really just a finance agreement.

The Cyclescheme says there are 2 options after 12 months. Either you pay a nominal fee to "buy" the bike or you pay a nominal fee to Cyclescheme to dispose of it.

So worry not.

 

[Downward]

A couple of years ago my budget manager sent out literature, but as I cannot cycle to work due to - distance, shower facilities (lack of), nature of job reasons, I wasn't able to take advantage of the scheme, and I certainly wouldn't consider 'taking advantage' either, as it would be dishonest, and as I'm in the honesty business it wouldn't be right, or proper.

All is says is for the 12 months you must use the bike for commuting more than for personal use so there is nothing stopping you driving with bike and parking 1/2 mile away and cycling the rest a few times, Then fein a dodgy knee for a few months and when the 12 months is up et voila !

 

[doyler78]

Hi
Your Company won't have an asset at the end of the 12 month Lease.

The purpose of leasing a bike of say £1k over buying a bike over £1k is to avoid the Capital costs. The company wouldn't be able to lease you a bike anyway even if bought through capital so they would just end up with say x amount of bikes for the staff to use (they couldn't charge you)while not only paying the purchase price but also paying 10% for the capital costs (depreciation)

There is clear guidelines that state the Cyclescheme is a leasing scheme and there is no purchase taking place. This is because the company's you and I are working for would have to obtain credit licences or something as if they let you buy a £1k bike over 12 months it's really just a finance agreement.

The Cyclescheme says there are 2 options after 12 months. Either you pay a nominal fee to "buy" the bike or you pay a nominal fee to Cyclescheme to dispose of it.

So worry not.

I think you are confused. Cycle to work does not equal cyclescheme.

Cyclescheme is an organisation who were setup to provide an administrative service to organisations who wished to provide a cycle to work scheme to their employees but didn't want the administrative burden of drawing up the hire documents and dealing with the bike shops. They are often referred to as facilitators.

For the Department of Transports guidance on Cycle to Work then I suggest you read this.

http://www.dft.gov.uk/pgr/sustainable/cycling/cycletoworkschemeimplementat5732?page=1#a1021

The organisation bought the bike and then hired it to the employee. At the end of the hire period the organisation can dispose of the bike and if they dispose of it to the employee there are certain regulations regarding that sale one of which surrounds the proper valuation of the bike. If the bike has a value and is owned by the organisation (otherwise how can it sell it) then that is what is called an asset or at least it was when I done my degree. Can you explain how its not so.

I think you have used existing knowledge of taxation to form an opinion as to why an organisation would hire the bike when in fact the reason for hiring is because the 1999 Finance Act expressly permitted huge tax savings to be made in order to enourage a greener form of transport and to help employees lead healthier lives. That's the reason why so employees have lobbied their organisations to introduce this scheme. Its nothing to do with the rules around the capitalisation of assets.

 

[Cosmo]

On my scheme we get charged 5%+vat of the initial value of the bike at the end of the year to keep the bike and £30 to return it as far as i am aware

john

 

[Mortiroloboy]

All is says is for the 12 months you must use the bike for commuting more than for personal use so there is nothing stopping you driving with bike and parking 1/2 mile away and cycling the rest a few times, Then fein a dodgy knee for a few months and when the 12 months is up et voila !

I may be moving to another place, much nearer home, if I do, I'll consider asking about the scheme again, as it would be commutable (just over an hour), so I could do that journey a couple of times a week say, then just use it for the Sunday Club run, so I'd be using it more for work than pleasure (as far as my job would be concerned ) I'd be getting some 'secret training' in

 

[Downward]

I think you are confused. Cycle to work does not equal cyclescheme.

Cyclescheme is an organisation who were setup to provide an administrative service to organisations who wished to provide a cycle to work scheme to their employees but didn't want the administrative burden of drawing up the hire documents and dealing with the bike shops. They are often referred to as facilitators.

For the Department of Transports guidance on Cycle to Work then I suggest you read this.

http://www.dft.gov.uk/pgr/sustainable/cycling/cycletoworkschemeimplementat5732?page=1#a1021

The organisation bought the bike and then hired it to the employee. At the end of the hire period the organisation can dispose of the bike and if they dispose of it to the employee there are certain regulations regarding that sale one of which surrounds the proper valuation of the bike. If the bike has a value and is owned by the organisation (otherwise how can it sell it) then that is what is called an asset or at least it was when I done my degree. Can you explain how its not so.

I think you have used existing knowledge of taxation to form an opinion as to why an organisation would hire the bike when in fact the reason for hiring is because the 1999 Finance Act expressly permitted huge tax savings to be made in order to enourage a greener form of transport and to help employees lead healthier lives. That's the reason why so employees have lobbied their organisations to introduce this scheme. Its nothing to do with the rules around the capitalisation of assets.

I was talking about the Scheme we use in Public Sector IE Cyclescheme. but I shall have a look through the DOT bumf there.

All I know is why we lease as opposed to buy in the Public Sector but sounds like there may be a good reason why they are all encouraging Cyclescheme if they are being given tax relief from the goverment.

 

[Downward]

To take advantage of the tax and Class 1A NICs exemption, an employer can simply buy a cycle and cyclists' safety equipment, reclaim the VAT, make use of the capital allowances and loan it to an employee for qualifying journeys to work.

So looks like the Goverment are not charging them Capital costs then.

 

[chonkers]

just got my bike on the ctw scheme on paperwork its says just need to use it for work at least 50% of the time and mine is over 18 month not 12 well happy with arrangement as without it i couldnt afford the bike i got asked what happens after 18months they said normally just keep bike for a nominal payment then start it again.

cheers

chonkers

 

[Night Train]

I must try to get work to take this up properly. They have a partial scheme with very little take up.
When I had a look at it the internal staff forms link on the intranet had pull down menus for selecting department and staff name. The names list wasn't well populated and I couldn't get on the list so I wasn't surprised to hear that there wasn't much interest.

I want to try to pursuade them to take it up properly and promote Bromtons and other folders to reduce the cycle storage problem they have too. The current 'safe' cycle storage is huge cycle safes that take up the space of a car and are placed on car parking spaces in the car park. Each only holds one bike!
My whole department could store a Brompton for each member of staff in the stationery cabinet in the staff room so there would be a saving in land use too.