Bike to work scheme 2016

parking_question_chap

Nasqueron wrote: »

In terms of buying a bike and saving money with the added bonus of a free 6 week checkup to deal with the cables bedding in etc, a new bike always rules over a second hand bike.

And to pick up on this as well.

If we take even an absolute worst case scenario of used bike being 50% the cost of a new bike. How would a £500 bike be better financially because it has a "free" checkup? When you could just pay for a £50 odd service a used bike that only cost £250.

Nasqueron

parking_question_chap wrote: »

Its not difficult to give a used bike a good once over before buying. Even a novice could do this after watching a couple of basic youtube clips.

You make it sound like servicing the Saturn 5 rocket.

Yeah nice hyperbole, I was pointing out the average commuter doesn't want to have to index gears / check cable stretch, true wheels, replace rim brake pads and adjust the brakes / check over the disc brake surface and pads, adjust stuff like the saddle, check for chain wear/stretch, check gear wear, check fluid levels in hydraulic brakes, service or replace a BB, check the headset, check wear on the wheels as well as checking the frame for fatigue and wear and tear

A novice COULD NOT do all that after watching a couple of youtube clips and then going to a second hand bike purchase where the seller might let you ride it a bit and look it over for a few minutes.

A shop offers proper service and guarantees, a second hand bike can be ragged to bits and survived a crash and be covered up

Nasqueron

parking_question_chap wrote: »

And to pick up on this as well.

If we take even an absolute worst case scenario of used bike being 50% the cost of a new bike. How would a £500 bike be better financially because it has a "free" checkup? When you could just pay for a £50 odd service a used bike that only cost £250.

And then the £50 checkup highlights all the parts that need replacing adding on extra money.

Vs buying a bike on C2W with a 30% saving getting a new bike which is well built, maintained, fitted to you in store and doesn't need expensive work doing

vacheron

One thing which makes a big difference is what happens at the end of the hire period.

HMRC believe that a £500+ bike is worth 25% of it's new value after one year so some one year schemes will hit you with a bill for £250 at the end if you want to keep the bike!

Other schemes will give you the bike as a benefit in kind which means you will only have to pay income tax at your marginal rate on the £250.

Our scheme uses the latter. Had it been the former then it would have really crushed the benefits to a basic rate taxpayer.

Remember as well that you can buy loads of accessories, clothing, panniers, shoes etc on the scheme with no final value to pay, this can also be cost effective. (Some allow you to just buy accessories and no bike).

parking_question_chap

Where I work had the former so didnt see it withwhile in the long run. Waited until I found a used bike which already had mud guards, bag rack and reflecters so saved a few more pounds.

Mr_Singleton

Wow this thread is still going.....

To put it succinctly C2W schemes and there ilk are great if.....

1) You're credit blacklisted

2) You're unable to budget

3) You live hand to mouth

For normal people who are able to get credit and/or budget you can get a similar or greater saving without the multitude of rules and risks by buying direct.

vacheron

Mr_Singleton wrote: »

Wow this thread is still going.....

To put it succinctly C2W schemes and there ilk are great if.....

1) You're credit blacklisted

2) You're unable to budget

3) You live hand to mouth

For normal people who are able to get credit and/or budget you can get a similar or greater saving without the multitude of rules and risks by buying direct.

I am a seasoned cyclist with multiple bikes and meet none of your assumptions, but show me how else I can buy any bike and /or equipment of my choosing with a guaranteed 42% discount at the margins bike shops operate on?

Yes it doesn't suit everyone, but I see no reason to be so utterly condescending and generalising towards those to whom it does.

PS. I didn't buy a from our scheme as I sourced an amazing deal elsewhere in the meantime, but had I not I would have used it.

Mr_Singleton

vacheron wrote: »

I am a seasoned cyclist with multiple bikes and meet none of your assumptions, but show me how else I can buy any bike and /or equipment of my choosing with a guaranteed 42% discount at the margins bike shops operate on?

Yes it doesn't suit everyone, but I see no reason to be so utterly condescending and generalising towards those to whom it does.

PS. I didn't buy a from our scheme as I sourced an amazing deal elsewhere in the meantime, but had I not I would have used it.

I'm not being condescending I'm mearly stating the facts. By all means tell people about it but give the full story warts and all.

You say that the the saving is guaranteed when its not. If I buy a bike in a shop then the saving IS guaranteed at the price you paid if you buy it on a salary sacrifice scheme you won't know the saving until you fully own the bike which is what? 4 years down the line. If at any time your circumstances change i.e you leave the company, the bike is nicked or a whole host of other rules the savings get reduced. The only additional equipment you can buy on these schemes is safety related. As I've already mentioned a cycle helmet is zero rated for VAT but NOT if your buy it through one of theses schemes.

Yes, I agree its possible to save 42% but ONLY if your a high rate Tax payer i.e you earn more than £43,001 a year which I'm going to suggest isn't going to be a large proportion of the people who are looking to use this scheme. Looking at Evans shows 60 bikes in the £500 to £1000 category with discount of up to 32% and 0% Finance which matches or betters what most people could get under these salary sacrifice scheme's but with NO STRING ATTACHED.

vacheron

Mr_Singleton wrote: »

I'm not being condescending I'm mearly stating the facts. By all means tell people about it but give the full story warts and all.

I think that is an excellent idea, but it is also good not to just provide "warts" either.

All I can do is refer to our company scheme as objectively as possible, so that is what I will do..

Mr_Singleton wrote: »

You say that the the saving is guaranteed when its not. If I buy a bike in a shop then the saving IS guaranteed at the price you paid if you buy it on a salary sacrifice scheme you won't know the saving until you fully own the bike which is what? 4 years down the line.
Our company scheme is 12 months which allows a better amount of certainty regarding such things. I have not personally seen a scheme which spans 4 years.

If at any time your circumstances change i.e you leave the company, the bike is nicked or a whole host of other rules the savings get reduced.
I'm not sure a "whole host" of other rules, other than the two you have mentioned, but you are correct that if you are made redundant or leave the company, or your bike is both not insured and stolen that you lose the tax break as the balance comes from net salary.... but alternatively you could just not tell anyone and pay until the end of the scheme and be no worse off than someone who had their regularly purchased uninsured bike stolen.

The only additional equipment you can buy on these schemes is safety related.
You can buy any equipment deemed necessary to ride to work. This can include, clothing, helmets, gloves, panniers, locks, shoes, mudguards, lights, tool kits, saddlebags, puncture repair, tubes etc. or even an additional bike. Yes, you can't get your go-pro or a pair of downhill forks but plenty of things normal people would want are allowable.

As I've already mentioned a cycle helmet is zero rated for VAT but NOT if your buy it through one of theses schemes.
I agree, so on a £40 helmet you lose out on £10, but then you save £13-£17 on the RRP by buying it from untaxed salary.

Yes, I agree its possible to save 42% but ONLY if your a high rate Tax payer i.e you earn more than £43,001 a year which I'm going to suggest isn't going to be a large proportion of the people who are looking to use this scheme.
Out of the 6 people in our office who have taken up the scheme, 3 are higher rate taxpayers, one of which has bought a bike with an RRP of £3000 on sale at £2350 for which he will pay the equivalent of £1650 of net pay (plus a £230 benefit in kind amount via PAYE the following year).

Looking at Evans shows 60 bikes in the £500 to £1000 category with discount of up to 32% and 0% Finance which matches or betters what most people could get under these salary sacrifice scheme's but with NO STRING ATTACHED
I agree there are bikes at up to 32% off, but as I my question was where you could buy "any" bike or equipment at that level of discount.

vikingaero

Mr_Singleton wrote: »

You say that the the saving is guaranteed when its not. If I buy a bike in a shop then the saving IS guaranteed at the price you paid if you buy it on a salary sacrifice scheme you won't know the saving until you fully own the bike which is what? 4 years down the line.

Most company schemes are 12 month contracts. You own the bike subject to a P11D payment or return it.

Yes, I agree its possible to save 42% but ONLY if your a high rate Tax payer i.e you earn more than £43,001 a year which I'm going to suggest isn't going to be a large proportion of the people who are looking to use this scheme.

Most of the uptake of C2W at our company are from higher rate taxpayers. There's possibly a correlation that these higher rate taxpayer/employees can afford the housing closer to our work premises which makes cycling more feasible. Those living 20+miles out are unlikely to be drawn to it.