Cycle to Work Benefit Scheme - Pros and Cons of Different Programmes

There's already a thread (see link below) which looks specifically at Halfords but figured it would be a good idea to have a more general post that looks at the different schemes on offer. My work is looking at entering this programme but is under the impression that they are all much of a muchness. Anyone care to share experiences first hand or otherwise of the different programmes?

http://www.londonfgss.com/thread3950.html

Ello runtime,

I got my bike through cyclescheme.co.uk.

A couple of my colleagues used Evan's ride2work scheme which cuts out a lot of the paper work and is much quicker, but obviously means you have to buy your bike from Evans, which cuts your choice down a lot. (Maybe similar with Halfords, I don't know?)

With Cyclescheme you have a much wider range of LBS to choose from and I was able to buy my IRO to my specifications from Cavendish Cycles. It took a bit of time (especialy if you are the first person in your company to apply for cyclescheme - as there is a lot of faffing about with contracts and crap, and then I had to wait for Cavendish to order parts and build the bike.) but I would still highly recomend as you will eventually get the bike YOU really want!

Best of luck with whatever route you decide to go down!

Hi Runtime,

My experiance of Cyclescheme.co.uk is positive for sure. I used them to get a Planet-X bike. My firm uses CS.co.uk anyhow, but I think from looking around, that this is the most flexible scheme in terms of outlets.
As a note to PX, I wanted my bike asap so they let me pay on my Credit Card and then once my voucher turned up, they refunded my card.
Dont think you will go wrong with this particular scheme.

Yep, I did the CS one as well, through Putney Cycles.
Do you know what bike you want?

For me the biggest unknown would be what the companies let you buy the bike for at the end of the lease period. 'Fair market value', I think it's described as. This could conceivable be quite high for a one-year lease. Or do companies play it cool and just charge a nominal amount? £10-30. Has anyone got that far in a scheme? What is your experience?

it depends on the CFO of your employer. Fair market value only needs to be enough for the inland revenue to not see the final transfer as a taxable benefit. Guidelines are so vague that no-one quite knows what to do - I've heard of prices ranging from £50 to 10% of the value of the bike.

one thing you can do is buy a very cheap bike, and then load up a whole bunch of components for your sunday best bike - that way FMV is based only on the bike which was cheaper.

For me the biggest unknown would be what the companies let you buy the bike for at the end of the lease period. 'Fair market value', I think it's described as. This could conceivable be quite high for a one-year lease. Or do companies play it cool and just charge a nominal amount? £10-30. Has anyone got that far in a scheme? What is your experience?

£20 or 5% for us.

Coming up next month, so I am just working out what to get this time. Yay.

I run the admin for the evans bike2 workscheme where I work - runs really well.
we ask for £5 to 'buy' the bike for at the end of the lease period - which is then donated to the company charity.
If you are unsure what your company might charge at the end - get them to put it in writing on the application form at the start so that it is a fixed amount/%.
first post on here....hello all....great forum.

A couple of my colleagues used Evan's ride2work scheme which cuts out a lot of the paper work and is much quicker, but obviously means you have to buy your bike from Evans, which cuts your choice down a lot. (Maybe similar with Halfords, I don't know?)

My employer is part of Halfords cycle2work scheme, and I was able to purchase a bike from Condor using the Halfords cycle2work voucher scheme.

Halfords can order ANY bike on the cycle to work scheme!

Halfords can order ANY bike on the cycle to work scheme!

but sometimes put them together badly (like a unipack actually).

The halfords cycle to work vouchers are also redeemable at Independant Bikehut stores, all of which have cytech trained mechanics, and are 100x better than the 15 year old kid who knows more about car stereos in your local store!!

okay, i emailed halfords (who run my work scheme) asking over if they could source the following OTP fixies:

Fuji track
Surly steamroller
Charge plug
Bianchi pista

they said no to the fuji, yes to the charge. they also suggested a pearson touche

hilariously, they have stated that the surly and the bianchi are "track bikes and not suitable for road use". my reply has pointed out that front brake means road legal, i'm waiting for a response.

Trying to get my work to get involved with one of these schemes, but they don't seem to be interested. You'd think that a large public institution, with a staff of almost 1000, would have the capability and desire to promote green transport and keep their staff happy? No no... This was the latest reponse:

"Generally our experience with salary sacrifice schemes in the past has not been good for a number of reasons and having spoken to peer institutions we've found that they have experiences similar problems (adminstrative burdens and liabilities/lack of protection around the scheme for employees being principle among these.

With that in mind we are currently exploring the possibility of being able to extend the Interest Free loan facility, which is available to staff for the purchase of a season ticket for travel purposes, to be able to incorporate bicycle purchases."

Which sounds to me like:
We can't be arsed with all the paperwork or taking on the small responsibility that it may put on us. So let's ignore the benefits and try this option which doesn't save you any tax, but might make you think that we're doing you a favour.

[/rant]

Damn the HR monkeys! I want a new Bob Jackson!

You should point out to them that this is essentially the same thing that they are offering. You pay back a loan via salary sacrafice, they still have to lend you the money, the risks are the same and the workload should not be that different.

With Cyclescheme you fill in your own form online and then they print out some paperwork that has to be signed by your HR department, it's easy. There will be an increase in workload for someone, that is inescapable. However the scheme saves your employer money too because they don't have to match the NI contributions that you save on the bike. We are talking quite a lot per person per year, more than enough to cover the extra costs of an HR person dealing with the work.

I would also point out the huge potential marketing value of this scheme, although not to the HR team, to a department that anyone cares about, like Marketing or to the board. Companies spend fortunes getting ISO 14001 just so they can put it on letterheaded paper. They don't give a fuck in reality. The HR dept will be told what to do by someone else, find that person and convince them of the benefits to the company and then maybe to the staff, but that really falls second to anyone in power.

Does anyone know anything about the legal factors for the Cycle Scheme?

I'm currently trying to persuade my employer (or more specifically, the head of Finance at my work) to take part in the scheme. The guy I've been talking to is extremely suspicious of the whole thing, as he thinks it's essentially a scam (the way you 'rent' the bike then go 'oh, can I buy that please?' once you've paid it off seems a little dodgy to him).

I've spent hours doing research trying to persuade him - I've found examples of other employers who do the scheme, including universities, NHS districts, and the police. I got hold of section 50 of chapter 16 of the 1999 finance act. I... you get the point...

But the guy's come back with his continued assessment of the scheme as 'dodgy'. He points out that it's essentially a loophole and this makes it risky. He's spoken to someone at HMRC who said that the original intention of the tax allowance was to make it easy for employers to loan bikes to employees, and that the current schemes are basically cheating the system. This makes Finance Man concerned that the company could face tax problems further down the line.

So does anybody know anything about this? I know that the scheme is legit. I've used it with previous employers and shtloads of people use it. However, if I want to do it with my current employers, I have to convince this guy that The Law isn't going to come down heavy on them.

Does anyone have any contact with HMRC? Does anyone have any info on this matter? Even the right number to call them would be handy - their website lists loads of different numbers, but I don't know which would be relevant.

Of course, the best thing would be if HMRC run the Cycle Scheme for their employees! Anyone know if this is the case?

oh dear, sounds like your head of finance is feeding you shit to get you off his back. poor skills.

either that or he is a genuine retard.

I know people why work for most government agencies, and they all use cycle scheme. And while it is a bit of a loop hole as far as the individual in concerned, it is entirely legal and above board.

Sounds like you're fighting a loosing battle there though.

ive just got a bike on the c2ws, its been a bit long winded but very good over all experience-wise. when my employer eventually got into the scheme which took about 12 months, we had a limit of £1,500 for bike and accessories and it comes out of my wages each month before tax, plus the 30 - 40% initially off the stuff. i spent about £600 and it comes out at £50 a month

oh dear, sounds like your head of finance is feeding you shit to get you off his back. poor skills.

either that or he is a genuine retard.

A bit of both, I think. He looked into it before I started and seemed to make his mind up back then. His suspicion of the scheme seems both ill-founded and deep-rooted. It's fun trying tho.

Sounds like you're fighting a loosing battle there though.

Yep :-( Worst comes to worst, I can always have a word with my manager and give the CEO a nudge, but I suspect they will cede to his 'expertise'. I'm going to try to get a written confirmation from HMRC that we won't get told off if we take part in the scheme, but I somehow suspect that even this won't be enough.

The guy has mentioned the idea of just giving a loan to employees to buy bike stuff, but I'm not nearly as keen to do this as it loses any of the savings I could have made otherwise. If he does this, I might as well just persuade my gf to get stuff for me through her work...

Ho Hum.

smells like bullshit to me, the company i work for employs over 2000 people in the uk and they readily endorse this scheme - in fact they are just about to open it up as a year round perk (previously we only had a small 1 month window every year to apply).

Have you tried emailing the people behind the scheme for a business case etc?

www.cyclescheme.co.uk

Also as far as I am aware, the whole 'renting' thing is a tax loophole so its not classified as a hired purchase agreement. Just a quick point as this guy sounds like a piece of work. The buying part at the end of the scheme should be 5% of the bikes cost - make sure he doesnt try to stiff you.

My final point is that you pay for this off of your base salary (i.e. before tax gets taken off) - doesnt this mean that your overall base salary decreases and therefore so does the NI contributions that your company has to make also decreases? So in the long term it could save them money - this may be complete bullshit but its just a thought

Just show the stupid fuck this website. Its the DfT site, THE GOVERNMENT.

http://www.dft.gov.uk/pgr/sustainable/cycling/cycletoworkschemeimplementat5732?page=1

okay, i emailed halfords (who run my work scheme) asking over if they could source the following OTP fixies:

Fuji track
Surly steamroller
Charge plug
Bianchi pista

they said no to the fuji, yes to the charge. they also suggested a pearson touche

hilariously, they have stated that the surly and the bianchi are "track bikes and not suitable for road use". my reply has pointed out that front brake means road legal, i'm waiting for a response.

If you get the Touche, go to Pearson's direct - they will take the Hallford's voucher directly over the counter, meaning you can spec up the bike exactly how you want.

I believe Condor also accept the voucher directly.

@.ptn loads of solicitor's firms have these schemes so they are certainly not a scam. I am certain that the person at HMRC that the FD spoke to was talking rot (if he ever did). There are numerous examples of tax rules and schemes being used (legitimately) for other uses and I am sure that the FD uses a few himself in the business. I suspect that he has made his mind up before he even investigated it so you are perhaps onto a hide into nothing here.