Cycle to Work Scheme gone wrong!

messenger2024

Hi all,

Newbie here, so just going to get stuck in. 

Short version: 
1 x halfords faulty bike
1 x disappeared bike 
3 x letter of collection and no refund. 

Long version:
My partner purchased a brand-new Electric Carrera Impel bike from Halfords Mile End store in Sept 2023 using the Cycle to Work Scheme.
The bike cost £1099. He collected the bike on the 15th of September from the build dept. at Halfords.
The electric bike stopped functioning multiple times. 22nd October he took the bike back as the battery
battery fully charged, would start, and a short moment after the battery would fail and the bike could not be ridden.
Left the bike at Halfords and they said the battery had since started working, so this was not investigated.

He took the bike 27th March 2024 and after many many emails, calls he was finally told he would get an exchange by the customer services dept. We then heard directly from the store manager, who said this was not true, that they could not find the fault. He refused to collect the bike and asked them to run more tests and still remained paying his instalments. 
5 months later (August 2024) the store manager had confirmation from Halfords that the bike was infact faulty and that they were issuing a full refund. This never happened. The refunds went back to the Cycle to Work and another Letter of Collection was sent. This wasn't what we wanted but they insisted it was the only way. Begrudgingly we accepted. Went to a different halfords store purchased another bike. The day we went to collect the bike 21st October 2024, it hadn't been built we were told to return the following week. We returned 30th October and the bike had "disappeared". 
We were told we would get a refund, but it had to be back to the original payment. I.e. Cycle to work. 

We complained to the Cycle to Work Scheme and 5th Novemebr they requested that under exceptional circumstances that a refund be given from Halfords back to my employer who would then give it back to me. Halfords kept saying that a refund cannot be given, as they cannot cancel the contract. At this point the bike had been paid fully. 

Last week, we started comms with another halfords customer service, lovely lady who listened to the entire story and said she would escalate. And 2 days later he received another Letter of Collection. Obviously not what we want.

At this point we are stuck. We don't want anything else to do with Cycle to Work or with Halfords ever again. 
It's been more than a year since the agreement started and he fully paid the bike 3 months ago. We don't have the bike or the money. 

If anyone has any advice or can advise us what we can do id really appreciate it! 

Alderbank

Your partner's employer should have explained to him how the Cycle to Work scheme works.

Under the scheme, your partner didn't purchase the bike. His employer did. His employer then hires the bike to your partner under a salary sacrifice arrangement. The benefit of that is that your partner doesn't pay income tax on the salary sacrifice hire payments and his employer doesn't pay NI on those payments either.

At the end of the hire period the employer can sell the bike to your partner if they wish, or they can keep it, but they can't just dispose of it. If your partner wants to buy it they must pay tax on the secondhand price paid. In practice, employers are usually happy to delay selling the bike to their employee for a few years until HMRC's estimate of the value is almost nothing (about £5 or so).

Does this help you to understand what has happened and why Halfords have done what they did?
Your partner has paid nothing to Halfords. The employer paid Halfords for the bike and your partner paid monthly hire charges.

There should be a nominated person at your partner's place of work who manages the scheme and who your partner can talk to. 

molerat

Your contract is with your employer and Cycle to Work not Halfords.  Halfords cannot refund you due to the tax implications.  Anything that needs unwinding needs to be done through your employer and Cycle to Work who will deal with Halfords.  Do you have an HR person who deals with the scheme ?