Southampton City Council scrap C2W!

[downfader]

http://www.dailyecho.co.uk/news/8885549.Budget_concerns_scupper_council_bike_scheme/

Its a sad loss. It never even got off the ground and they scrapped it. Perhaps the Councillers/Executives should take less of our money to faciliate something that is dreadfully needed. After all parking is massively at a premium, as is space on the roads during peak times.

 

[pshore]

To be honest DF, it is not a great loss. Since the changes by HMRC it is now only acting as an interest free loan.

The reality is that I saved £27 quid on a £1000 bike. You get a loan but you don't own your bike for four years. For more detail see my blog post . Bitter, me ? Yes.

 

[Norm]

To be honest DF, it is not a great loss. Since the changes by HMRC it is now only acting as an interest free loan.

The reality is that I saved £27 quid on a £1000 bike. You get a loan but you don't own your bike for four years. For more detail see my blog post . Bitter, me ? Yes.

An alternative "reality" is that your LBS added 30% to the price of the bike, to cover Cyclescheme's 10% charges and your employer are lazy in using Cyclescheme in the first place.

With the LBS making 20% and Cyclescheme making 10%, you were saving money and getting an interest-free loan, even with the revised buy-out charges.

 

[400bhp]

To be honest DF, it is not a great loss. Since the changes by HMRC it is now only acting as an interest free loan.

The reality is that I saved £27 quid on a £1000 bike. You get a loan but you don't own your bike for four years. For more detail see my blog post . Bitter, me ? Yes.

I cant see where your £27 has come from?

 

[Jezston]

Just read the blog. Why on earth did you let them charge you £1300 for a bike they were selling for £1000?
I can understand them perhaps insisting on adding up to 10% to compensate for C2W's charges, but 30%?!?
Or was that including a couple of hundred quids worth of accessories?

 

[Lizban]

Not suprised, it is an over complicated scheme that had good benefits but many draw backs.

I've advocated for a while to reduce teh VAT on bikes to 5% instead.

 

[Norm]

Not suprised, it is an over complicated scheme that had good benefits but many draw backs.

Although I think that 5% VAT is a good plan the cycle to work regulations are not complicated and have few drawbacks.

However, the poor communication from employers who implement the scheme and the way that they have been implemented has made it complicated and involving Cyclescheme introduces drawbacks but the scheme itself is sound, IMO.

 

[pshore]

Just read the blog. Why on earth did you let them charge you £1300 for a bike they were selling for £1000?
I can understand them perhaps insisting on adding up to 10% to compensate for C2W's charges, but 30%?!?
Or was that including a couple of hundred quids worth of accessories?

The numbers are a little skewed - let me explain.

The situation was RRP for bike £1500. I found it online for £1000 from one(!) shop. I spoke with my LBS who said they would match that price if I just bought the bike as a normal purchase.

The other deal on the table was that I could buy the bike via C2W. They would have to charge a different price £1300 because CycleScheme are taking a cut. This is very common - I have seen other threads on here about that.

Tapping the numbers into the CycleScheme website, I found that it would cost me £832 for the bike plus it would be a 10 month loan. I thought about this and thought if I was benefiting and the LBS was too then its good all round.

So after the HMRC fiddled and I analysed my pay slip differences it actually cost me £973. That's £27 difference from what I could have bought the bike for.

Sure I got a loan, but I don't own my bike and won't for another 3 years and I am still at risk from the government fiddling and charging me more.

(Just for clarification, I bought no accessories)

 

[beanzontoast]

Rather than C2W schemes, VAT on bikes really should be removed. I can't imagine the government makes much out of it. It would give more people the incentive to cycle, keep healthy and reduce the pressure of motor vehicles on the road.

I may well be over-simplifying the economics, but to have VAT on bikes while at the same time trying to encourage people to buy and use them seems contradictory.

 

[mark barker]

I'm not a fan of the C2W scheme at all, but I do find it strange that a council would cancel it.

I agree with the comments above regarding VAT, although I do wonder if the reductions would actually filter down to the consumer or would it just increase the profits of the retailers....

 

[Chrismawa]

I agree no VAT would be a better option.

I looked at the C2W scheme but it didn't look to appealing.

 

[MacB]

Rather than C2W schemes, VAT on bikes really should be removed. I can't imagine the government makes much out of it. It would give more people the incentive to cycle, keep healthy and reduce the pressure of motor vehicles on the road.

I may well be over-simplifying the economics, but to have VAT on bikes while at the same time trying to encourage people to buy and use them seems contradictory.

Even better offset the cost by increasing motoring costs, give them something real to moan about when they shout out of cars at us

 

[Chrismawa]

Even better offset the cost by increasing motoring costs, give them something real to moan about when they shout out of cars at us

No thanks, the costs are high enough!

 

[Lizban]

Although I think that 5% VAT is a good plan the cycle to work regulations are not complicated and have few drawbacks.

However, the poor communication from employers who implement the scheme and the way that they have been implemented has made it complicated and involving Cyclescheme introduces drawbacks but the scheme itself is sound, IMO.

The aim is to get people commuting to work. In order to achieve this teh C2W scheme uses a credit agreement, a contractual change and a reduction of your salary.

This is complicated.

I work as a consultant in the Employee relation field and getting people to understand a Salary Sacrifice arragement I have seen done well only a handful of times. People a literally throwing money away rather than sign up (esp. for pension contributions)

The majority do an OKish job.

To me it is too complicated.

5% VAT rate encourages cycling full stop, is clean easy and simple.

 

[Jezston]

The numbers are a little skewed - let me explain.

The situation was RRP for bike £1500. I found it online for £1000 from one(!) shop. I spoke with my LBS who said they would match that price if I just bought the bike as a normal purchase.

The other deal on the table was that I could buy the bike via C2W. They would have to charge a different price £1300 because CycleScheme are taking a cut. This is very common - I have seen other threads on here about that.

See this is where I get stuck - 'Cyclescheme' charge 10%, which would make it fair that the LBS charged you £1100 for it (although I'd have thought they should charge you less as the scheme is getting them the sale which without it would mean no sale), but the LBS added on a whopping 30%.

I think your LBS took you for a ride, so to speak. I think they are the culprit in your story, not the taxman.

...


A removal on VAT on bikes would make more sense than the slightly convoluted C2W work stuff as it would mean no admin for employers either, but I would be concerned like others that there would be little compulsion for the retailers to pass this cost on to consumers. From what I've heard, and would like to be corrected, bike shops haven't had it this good in a long time.