Government/ Company Cycle Scheme

[pickzmx]

Hello, i am new to the forum, but have been cycling for several years now.

I wasn't currently in the market for a new bike, until my company announced it may be starting in the cycle scheme www.cyclescheme.co.uk, Initially it appears to be amazing.

If you dont know the company buys the bike and you pay it back out of your wage Tax and interest free and you also save the tax when buying the bike. Calculations say it can be upto 50% discount on the bike of your choice. The only stipulation i can find is that you have to pay a lump at the end of the 12 months interest free repayments to own the bike.

This lump sum is said to be a 'Fair Market Value'????!!

After getting excited about the prospect of buying a fancy full susser, i thought i best check it out to see if any one has any experience of the scheme and if it is as beneficial as it seems or have people been stung for a large lump at the end, and it hasn't worked out much cheaper?!

Cheers

 

[Bollo]

Hi pick


There's plenty on here, including me, that have used the cycle2work scheme, so it might be worth doing a search as most points have already been discussed.

Before you get excited about that full carbon stumpjumper, unless your company has a credit licence then there's a limit of £1000 on the cost of the bike. Also, if your company chose to use a 'provider' to run the scheme rather than run it themselves, then there may be some constraints about the makes and models are available.

I forget the various interpretations of 'fair market value', but generally its lower than you might expect.

 

[Cedric]

Oh hi! I just posted a much more grumpy rant about Bike To Work and I'm having some of the same doubts. I'm sure that Bollo is right, but at the end of the day I don't think that you'll be getting the bike at much of a discount. It seems to me that if you want to buy a fairly expensive brand new bike it's a good option. There are plenty of secondhand bikes that are perfectly good for commuting. The average price of the bikes purchased by my co-workers seems to be around £500, and most of them are full suspension MTBs. Two thirds of the subscribers don't even cycle to work and my company has an exclusive deal with the most expensive bike shop in town. I don't think I'll bother. It's not right for me, but it's probably right for most other people, so good luck.

 

[Black Sheep]

full sus bikes are not made for commuting, unless you live on the top of snowdon and work at the bottom, then it might make sense,

 

[Lazy-Commuter]

The FAQs on their website says that "in our experience the market shows values to be around 5% of the original voucher value plus VAT." So if you bought the £1000 option, you'd be looking at around £57.50 as the final payment.

 

[goo_mason]

Hello, i am new to the forum, but have been cycling for several years now.

I wasn't currently in the market for a new bike, until my company announced it may be starting in the cycle scheme www.cyclescheme.co.uk, Initially it appears to be amazing.

If you dont know the company buys the bike and you pay it back out of your wage Tax and interest free and you also save the tax when buying the bike. Calculations say it can be upto 50% discount on the bike of your choice. The only stipulation i can find is that you have to pay a lump at the end of the 12 months interest free repayments to own the bike.

This lump sum is said to be a 'Fair Market Value'????!!

After getting excited about the prospect of buying a fancy full susser, i thought i best check it out to see if any one has any experience of the scheme and if it is as beneficial as it seems or have people been stung for a large lump at the end, and it hasn't worked out much cheaper?!

Cheers

As I said elsewhere, our scheme asks for 5% of the original value that you asked for to get the bike. So my £545 SCR2 will officially belong to me for £27.50.

Alternatively I could hand it back to them at the end of the month, but that would cost me a £60 disposal fee....

 

[Cedric]

So my £545 SCR2 will officially belong to me for £27.50

Sorry to be a dick, but you've also paid around £250 in instalments. Still a very good deal mind.

 

[Downward]

Bear in mind that Bike shops pay 10% to cyclescheme so generally rrp will be charged (Unless you can get a sale bike) and if your company can't reclaim vat (NHS for example) savings are about 31%. Factor in purchase price at the end + vat and its savings of maybe 17% on the rrp of a bike.

 

[redjedi]

I finished paying for my bike in December. The bike still "officially" belongs to the company for another year, which is when they'll write it off, so I won't be paying any extra.
This is easy for our accountant to do with a couple of the bikes which cost around £500 each, but he wasn't too pleased when one of the MDs got a £4000 Specialized S-Works MTB.

 

[Cedric]

Well a Polish guy at work bought an old refurbed Raleigh racing bike for £60 at a LBS sale, rode it for six months and sold it for £40 on Gumtree. Wish I'd bought it off him! C2W might be a good way to get a bargain on an expensive bike, but I'm not sure it's the cheapest way to do it, but that's not necessarily the be all and end all for everyone. Thanks for the heads up on establishing final payments before you sign up.

 

[summerdays]

I don't think you can establish the final payment before you start - otherwise it would be a hire purchase scheme, but what company wants a load of used bikes on their hands. Mr Summerdays used the scheme (just before they got rid of it), and near the end they told him what he needed to pay to complete the purchase. He could of got the bike cheaper online I agree but he supported the LBS in the process too.

If they ran it again (don't think they will as they have been taken over), then he would do it again.

 

[mr_cellophane]

You can also add accessories into the price - helmet, lights, bags, pump etc.

 

[goo_mason]

Sorry to be a dick, but you've also paid around £250 in instalments. Still a very good deal mind.

But the fact that I never notice the payments because they're spread out over 12 months and taken from my salary before I get it makes it all the better

But yes, it's a really good deal if you want to get yourself a nice new bike. If anyone saw a £545 bike on sale and reduced to the price I've just paid over a year, I'm sure they'd try and snap it up.

But it's horses for courses. If you're after a cheap commuting bike, then the second-hand market is probably the best bet. I just wanted to treat myself to a nice, sparkly road bike and I've enjoyed every second of riding it immensely, so it's more than made up for its value. I'd be paying almost the same for an annual bus pass these days, and I know which way I'd rather travel to and from work

 

[Downward]

It's good for starting out as you can get all the accessories too.
Then for the 2nd year you can buy a more expensive 2nd bike !

It's a good way too of supporting your local lbs who are struggling to compete with internet stores esp on the accessories.

I know I paid £150 for :
Helmet £60
Lights £20
Comp £20
Tools+ Bag £20
Bar Ends £10
Pump £20

Oh and I they gave me a £60 Courier type bag.
These prob could have been bought on the cheap but for me it works out at £8 a month or something after tax and ni. Bikes costing £26 per month Total £312. Add in 5% + Vat to "buy" makes it £26 ish so £450 bike will cost me £338. But It looks like you have to pay 5% + Vat for the Accessories (There is no VAT on Helmets) so add another £12 ish for £340

Total Voucher £600
12 months at £35 = £420
5% + Vat of £600 = £32 (Excluding the Vat on Helmet)

So £600 for the equipment will in the end cost me just over £450.

Real life savings are 25% thus.

 

[pickzmx]

Hi, Thanks for the replies guys.

I think it will work out pretty good for, i'm using it as an excuse to get a new xc bike im not a big commuter.

Looking at getting a £1200 bike so i can put a £200 deposit down.

With the 0% interest free installment even if it only works out a couple of hundred quid cheaper i think it'l still be the most practical way of buying the bike.

Cheers.