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Cycle to work scheme.

Hello everyone, has anyone had problems getting their employer to set the scheme up? I was talking to the accountant the other day and please correct me if I'm wrong, but does your employer buy the bike and then you pay it bak over the year. So does this mean they pay the £1000 and then the claim it back?

Please can someone clear this up. Thanks in advance.

Comments

  • Hi Nick. That's right. Employer buys the bike, and effectively leases it back to you over the course of the 12 months. At the end of that period, it charges you a nominal fee (my employer took about 99p out of my salary, if I remember rightly) to transfer ownership to you.

    Evans Cycles has a really good guide to the whole scheme here:

    http://www.evanscycles.com/ride2work/the-benefits

    By the sound of it, the employer can make savings on NI by setting up such a scheme. It can also treat the bike as a business asset, so it doesn't pay the VAT.

    Lots of my colleagues have taken advantage of my employer's R2W scheme – so much so that space for bikes at the office is hugely oversubscribed. If you're the only person who really wants the scheme set up, I can imagine it's a bit like banging your head against a brick wall with your HR department.

    Also, having read various threads about R2W on here over the last couple of years, different cycle shops offer different levels of flexibility about what you buy etc. By the sound of it, Evans is fantastic – on selling you the bike, that is. Wouldn't go near for servicing/aftersales as they're so disorganised!

    Do a search on the forum for other threads on R2W. It's quite an eye opener.
  • OranjOranj Posts: 45
    <rant>

    I work for a large company (~ 300 employees) in Oxford, which is a relatively "cycle-friendly" town and I've posed questions about the scheme to our health and social committee a couple of times, but our employer just thinks it'd be too much trouble to set up. I don't need a bike myself (I've already got four), but it'd be nice if our bike racks were as full as the car park. They seem to think it's "on trend" for the company image if we're signed up to some meaningless carbon neutral scheme (about as effective as taking your empties down to the bottle bank in a 4x4 if you ask me), but not if the employees can save a bit of CO2 and reduce the traffic congestion at the same time as saving some money.

    </rant>
  • I think last year my boss was being a bit tight, but I think I need to just work on him. In fairness my work put a shower in and thet's not bad for a company of only 25. It is frustrating though I just wished that the UK was just really cycle friendly.


    Cheers everyone.
  • ZacniciZacnici Posts: 1,385
    I have been known to be scathing about employers but to be fair the phrase 'government scheme' will probably send your boss into palpitations. They probably think that this scheme is going to cost them time, money and involve huge mounds of paperwork to administer never mind to research and impliment.

    I think that anyone wanting to take advantage of this scheme has got to do more than lay out bullet points and then walk away expecting him to get it set up. You need to set out what benefit he will get out of it i.e. saves him money. You need to quantify this e.g. for a bike etc up to the £1k max "this will save you £128 in NI contributions". 'Super' he thinks 'but then it will cost me that for the accounts/payroll to work all this out telephone calls to HMRC, bike shop, letters faxes etc nah screw it, not interested.'

    The DFT guidance is 12 pages long, I guarantee his eyes will glaze over after 3 paragraphs
    http://www.dft.gov.uk/pgr/sustainable/c ... idance.rtf
    Then if you throw this at him
    http://www.hmrc.gov.uk/specialist/salary_sacrifice.pdf
    he will throw you out of the office.

    You are going to have to produce a step by step series of instruction that is so simple that he can understand it, if he can understand so can accounts/payroll. You are going to have to speak to HMRC, the bike shop, the accountant, payroll etc. and talk things through, tease out the snags etc. You can then lay on your 2 or 3 slide PowerPoint presentation or single A4 sheet of paper with bullet points and tell him, this will save you money (NICs and Tax of up to 100% as capital expenditure and this must be quantified e.g. £128 in NICs, £210 in Corportaion Tax), this will make me happy, Hilda in accounts says she can set it up easily and at no cost to you and if you will do this then it also means that you can receive government recognition on the Cycle to Work Guarantee etc. etc.

    Funnily enough my employer, which is a Govt dept, has not signed up to the Cycle to Work scheme and gives as a wishy washy excuse 'we have agreed discounts with several retailers as part of the staff discount scheme which will be benficial to cyclists and staff may prefer to use those retailers rather than be restricted by the contsraints of the Cycle to Work scheme etc'
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