Cyclescheme bicycle condition assessment

[Jezston]

We really need to get an independent tax-specialist accountant/solicitor to go through the cycle to work scheme fine print and explain to us all in laymans terms how it all works and what the holes and contractions are.

Anyone fancy a whip-round?

 

[Jezston]

Another big cycle scheme question bundle!

There are private third party cycle schemes, and then your company can do it itself.

If you employer can go DIY, does this mean you could buy your bike from ANY shop, even one that isn't 'registered' (whatever that entails) to a particular scheme?

If so, what if the shop you want to buy it from is a very small, fairly new business that hasn't got round to doing things like being VAT registered etc?

And if that's do-able, what is there to stop you building a bike yourself and then your employer buying it off your 'shop' under the cycle scheme?

 

[MartinC]

I think more people are seeing why I wrote a few months back that everyone should encourage their employer to steer clear of Cyclescheme.


The only reason I commuted by bike was that I was able to use the C2W scheme to buy the bike in the first place. There's no way I would have got the road bike without the C2W scheme.


As I've said a couple of times, tough. The bike belongs to the employer, if you gave them £1,500 without realising the implications, then more fool you.

Good points Norm. This thread's been interesting for me in that I'd discounted too much the encouragement to commute by bike it's provided. It's been good to be reminded that there are many examples where it's done the job.

I someone's contributed £1500 to "their" bike then they might not have a (legal) leg to stand if their employer wants to include it in the transfer charge but it would be relatively easy to include it in HMRC's accounting of the benefit they've recieved.

 

[Riding in Circles]

I suspect dealers will be sympathetic to the buyers.

 

[Bromptonaut]

I suspect dealers will be sympathetic to the buyers.

Any experiences of this?

My employer, a large Govt Dept, used Cycle Solutions/Wheelies Direct. Neither is remotely interested in providing an end of lease valuation, nor will any other bike shop, as they don't want to take the risk.

Cycle Solutions publicity when the scheme opened referred to value being approximately equal to a 'month13' payment. The employer however has always inisited on a valuation - apparently their inspector got picky long before all the others.

 

[crumpetman]

I am curious as to what happens to someone if they do not take the bike to be assessed/valued and just keep on using it, or sell it privately at the end of the 12 months.

I really fancy a £1k carbon road bike if I can get it for about £50 a month.

 

[summerdays]

It's not yours to sell - so presumably the cycle scheme could ask for a lot of money?

 

[Norm]

It's not yours to sell - so presumably the cycle scheme could ask for a lot of money?

Indeed. Selling something which belongs to your employer would not, in general, be a good thing to do.

I think that this is a fundamental point which many miss. Just because you ride the bike, it is not yours, any more than a computer or company car. Selling the company's Mondeo would not go down well, nor would cashing in on a handful of Dells, so don't expect them to look too favourably on you selling their bike.

The other thing which is allowed in the scheme guidelines is that, at the end of the official rental period, your employer can allow you to continue using the bike without charge. Maybe that should be encouraged more.

 

[summerdays]

The other thing which is allowed in the scheme guidelines is that, at the end of the official rental period, your employer can allow you to continue using the bike without charge. Maybe that should be encouraged more.

Is that an automatic allowance... or does it have to be agreed in advance? how does it work?

Would you still have to insure the bike... what would happen if it was stolen?

(Do you ever regret being the font of all knowledge on the Bike to Work scheme)

 

[Riding in Circles]

Any experiences of this?

My employer, a large Govt Dept, used Cycle Solutions/Wheelies Direct. Neither is remotely interested in providing an end of lease valuation, nor will any other bike shop, as they don't want to take the risk.

Cycle Solutions publicity when the scheme opened referred to value being approximately equal to a 'month13' payment. The employer however has always inisited on a valuation - apparently their inspector got picky long before all the others.

The requirement of the dealer is to give a condition assessment according to Cyclescheme guidelines, A,B,C or D. I suspect now that Cyclescheme has been sold the new owners are looking at ways of making even greater profits although I cannot be sure. Giving a D rating to the bike will result in it having a much lower value.

 

[dodgy]

I beg to differ, the cyclescheme does work as it did for me last year! I've been through it once and currently going through it for the 2nd time.

Matty, yes you can save money by getting last years model off the net, but if you find somewhere that supplies last years model that also is part of the scheme then you save even more!

Jezston - what questions do you actually have? I'll answer them where possible.

That goes against what I've been told by several shops (one of which a trusted friend is the manager). They say they must use the full RRP of the bike in cycleschemes.

 

[Norm]

Is that an automatic allowance... or does it have to be agreed in advance? how does it work?

Hmm... yes... and no...

It is automatic in that the HMRC regs do allow it to happen. Whether you can do it or not is down to your individual scheme rules.

Would you still have to insure the bike... what would happen if it was stolen?

Yes, most definitely. The bike remains the employer's property and there is still value in it. Nothing would change other than the rental payments.

(Do you ever regret being the font of all knowledge on the Bike to Work scheme)

No problem at all.... although I should point out that anything I write is no more or less valid than anyone else's ramblings. And the value of your home is at risk etc etc

That goes against what I've been told by several shops (one of which a trusted friend is the manager). They say they must use the full RRP of the bike in cycleschemes.

There is nothing in the regs to require this. It could be that Cyclescheme set the requirement, which would just be another reason not to use them.

 

[GrasB]

There is nothing in the regs to require this. It could be that Cyclescheme set the requirement, which would just be another reason not to use them.

It's a retailer requirement, with the shop only getting 90% of the value printed on the voucher it leaves precious little profit margin.

 

[Norm]

It's a retailer requirement, with the shop only getting 90% of the value printed on the voucher it leaves precious little profit margin.

Whilst that's true, that is not what dodgy said.

 

[Nick_B]

Let's face it the scheme has always been wrong-headed. (Hypocrite alert. My SCR2 was bought on cyclescheme).

Government (ie society) pays a financial incentive to encourage people to commute by bike rather than car. Society benefits (marginally) through reduced congestion (time lost for people and businesses), less pollution, less noise, less carbon, improved health (less NHS spend), etc. So far so good.

The problem is that the cost of the incentive should be good value to society. It makes no difference to congestion, etc if I'm riding a £300 or £3k bike. So the incentive should have no link to the value of the bike.

It seems now that HMRC have decided that people who use cyclescheme are getting a tax break, and this must be stoppped. The whole point of the scheme was to give tax breaks to encourage cycling ffs.

An earlier post suggested that the scheme could still be good value to the rider as a cheap form of finance. If that's the aim scrap the scheme and introduce interest free loans. Better still just give away £100 vouchers (through employers in return for a meaningless and un-monitored / un-checkable promise to ride to work once in a blue moon) for use at approved retailers. Better value for society, less cost to run, less grief. (Less of a discount I admit).

Strictly speaking my boss owned my bike for a year. I'm sure that's not how he saw it. We're not a second hand bike shop. The point for the business is to give a perk to staff at little or no cost. I was charged 5% of the value just so that the arrangement was legal. I'm sure that they wouldn't have asked for the 5% if they didn't have to.

The confusion now seems to be what the market value is at the end of the year. More muddled thinking from government. The scheme seems to allow a "self assessment" of condition and so this valuation has absolutely no credibility. Would you tick the "my bike is just like it came out of the factory, please charge be £500" box? And by the end of the year you've already paid for the bike once (less vat, NI and income tax which HMRC decided that they did not want to take at the time). Why should we pay again?