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  • FIRST POST
    Sponge
    Cycle to work scheme
    • #1
    • 5th Aug 09, 9:32 PM
    Cycle to work scheme 5th Aug 09 at 9:32 PM
    My employer has just signed up to the scheme and I wondered if anybody had any experience of it?

    I'm tempted, but put off by what happens at the end of the loan period.

    What happens at the end of the loan period?

    Most employers opt to sell you the bike and accessories, and you will pay the fair market value; this is the amount that a buyer would pay to a seller to purchase the bike and equipment. Each bike is assessed separately, but in our experience the market shows values to be around 5% of the original voucher value plus VAT. The fair market value cannot be stated before or during the scheme as this could be considered a benefit in kind as hire-purchase does not warrant any tax-relief.
    If the 5% is accurate, then it'd be worth while buying a bike. But if it isn't, then I'd be better off just using my employer's other scheme, which is a simple 12 month interest free loan of up to 500,repaid monthly from my salary.
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