Author Topic: When your employer isn't on a cycle to work scheme...  (Read 2480 times)

citoyen

  • Occasionally rides a bike
When your employer isn't on a cycle to work scheme...
« on: September 10, 2020, 06:53:43 pm »
What are your options when your employer isn't on a cycle to work scheme and can't be persuaded to sign up? Are there any other legit ways to take advantage of the tax breaks?
"The future's all yours, you lousy bicycles."

quixoticgeek

  • Mostly Harmless
Re: When your employer isn't on a cycle to work scheme...
« Reply #1 on: September 10, 2020, 07:44:40 pm »
What are your options when your employer isn't on a cycle to work scheme and can't be persuaded to sign up? Are there any other legit ways to take advantage of the tax breaks?

I believe the official advice is find a better employer.

J
--
Beer, bikes, and backpacking
http://b.42q.eu/

citoyen

  • Occasionally rides a bike
Re: When your employer isn't on a cycle to work scheme...
« Reply #2 on: September 10, 2020, 08:47:19 pm »
What are your options when your employer isn't on a cycle to work scheme and can't be persuaded to sign up? Are there any other legit ways to take advantage of the tax breaks?

I believe the official advice is find a better employer.

J

Yes, I suspected as much.

I’m not asking on my own behalf so I don’t know if there’s any possibility of the employer in question being open to changing their mind. Apparently they used to be signed up to a c2w scheme but changes in the organisation mean they no longer are, and it doesn’t sound like signing up again is a high priority.
"The future's all yours, you lousy bicycles."

telstarbox

  • Loving the lanes
Re: When your employer isn't on a cycle to work scheme...
« Reply #3 on: September 10, 2020, 10:18:15 pm »
If self purchasing, I would put it on a 0% credit card so at least you can spread out the cost if necessary. 
2019 🏅 R1000 and B1000

robgul

  • Cycle:End-to-End webmaster
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    • Cycle:End-to-End
Re: When your employer isn't on a cycle to work scheme...
« Reply #4 on: September 11, 2020, 07:51:22 am »
Having operated the various Cycle to Work schemes when managing an LBS the real end result of all the maths isn't that brilliant . . .   

The LBS has to give up 10% to most of the schemes and 15% if it's a Halfords voucher (that's at November 2019, I believe it may be more now?) - accessories command a 15% kickback from the LBS to the scheme operator.  That reflects in the total transaction cost and needs to be looked at in the light of the "tax and NI saving" for paying a higher price for the bike against self-funding (obviously if you can).  There are also several schemes where the user has to pay an "exit fee" of a % of the value.

Various options with zero interest credit card options etc can make it work with a bit of research - and getting a better price from the LBS/bike supplier.

BUT from what I hear the current shortage of bikes (other than the mega-expensive models) means that discounts are hard to come by - market forces and all that.

Last time I looked the Green Commute scheme  https://greencommuteinitiative.uk/   had some different approaches that may work in a more cost effective way.


citoyen

  • Occasionally rides a bike
Re: When your employer isn't on a cycle to work scheme...
« Reply #5 on: September 11, 2020, 09:04:15 am »
BUT from what I hear the current shortage of bikes (other than the mega-expensive models) means that discounts are hard to come by - market forces and all that.

Yes, you'd normally expect to see some good discounts on current year models at this time of year, but there's very slim pickings out there, and a lot of 2021 ranges don't seem to be available yet either.

Quote
Last time I looked the Green Commute scheme  https://greencommuteinitiative.uk/   had some different approaches that may work in a more cost effective way.

Thanks, will pass that on. Looks like it still requires the employer to do the paperwork though...

"The future's all yours, you lousy bicycles."

Re: When your employer isn't on a cycle to work scheme...
« Reply #6 on: September 11, 2020, 09:30:09 am »
Mrs Trekker mentioned we could transfer the parts from her old commuter (and her first road bike bought to see if she liked it) onto a shiny new, more suitable frame.

Cannot find one....
Duct tape is magic and should be worshipped

Re: When your employer isn't on a cycle to work scheme...
« Reply #7 on: September 11, 2020, 09:44:18 am »
I bought a Synapse on my works C2W scheme about 7 years ago. List price was £700. By the time I'd paid the exit fee, and an "admin" fee, I saved about £70
Other schemes may differ, but if I was doing it again, I'd go 0% c/c

Re: When your employer isn't on a cycle to work scheme...
« Reply #8 on: September 11, 2020, 09:53:41 am »
AIUI a lot of employers have no mechanism in place to charge the admin/exit fee so you can make out handsomely that way.


citoyen

  • Occasionally rides a bike
Re: When your employer isn't on a cycle to work scheme...
« Reply #9 on: September 11, 2020, 10:15:46 am »
I've suggested to the prospective bike buyer that they focus on looking for the bike they want to buy, then working out the best way to fund the purchase.

As well as credit cards, a lot of the bigger retailers seem to offer finance packages too.

I've already decided what bike I would get if it were me making the purchase, which is of course the most fun part of offering advice to prospective bike buyers...
"The future's all yours, you lousy bicycles."

Re: When your employer isn't on a cycle to work scheme...
« Reply #10 on: September 11, 2020, 10:48:53 am »
The LBS has to give up 10% to most of the schemes and 15% if it's a Halfords vouche[/i]
It's understandable why independents would dislike the Halfords voucher, but if the bike is available from them it's usable on all bikes including those reduced in a sale.  It's certainly unfair that they've been allowed to be administrator and supplier, but from a purchasers perspective it's probably the best voucher to have, if Halfords can supply the bike you want.
The high transfer of ownership cost came about when HMCE clarified that giving it away was a benefit (I'm surprised anyone ever considered it otherwise) it didn't take long for the scheme providers to find a legal way around it by extending the period of time, lowering the value, before that transfer.
I dislike the scheme, those on low pay who would most likely benefit are excluded, whilst those buying new toys every year are rewarded.

fuaran

  • rothair gasta
Re: When your employer isn't on a cycle to work scheme...
« Reply #11 on: September 11, 2020, 10:53:26 am »
The employer doesn't have to use a scheme provider. They could just pay the shop directly, and set up a salary sacrifice arrangement to repay it.
Would mean no extra admin fees.

Re: When your employer isn't on a cycle to work scheme...
« Reply #12 on: September 11, 2020, 10:55:13 am »
I've suggested to the prospective bike buyer that they focus on looking for the bike they want to buy, then working out the best way to fund the purchase.
If they can come up with some self employed income, the first £1,000 is considered a trading allowance and tax free (Though you can't additionally claim expenses)
2 - 3 hours Deliveroo a week = £1,000 tax free bike spend a year.

fboab

  • It's a fecking serious business, riding a bike
Re: When your employer isn't on a cycle to work scheme...
« Reply #13 on: September 11, 2020, 11:05:30 am »
The employer doesn't have to use a scheme provider. They could just pay the shop directly, and set up a salary sacrifice arrangement to repay it.
Would mean no extra admin fees.

Except the cost of the time for the internal person to do that admin...
TSS is not Total Sex Score, Chris!

robgul

  • Cycle:End-to-End webmaster
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    • Cycle:End-to-End
Re: When your employer isn't on a cycle to work scheme...
« Reply #14 on: September 11, 2020, 12:23:33 pm »
BUT from what I hear the current shortage of bikes (other than the mega-expensive models) means that discounts are hard to come by - market forces and all that.

Yes, you'd normally expect to see some good discounts on current year models at this time of year, but there's very slim pickings out there, and a lot of 2021 ranges don't seem to be available yet either.

Quote
Last time I looked the Green Commute scheme  https://greencommuteinitiative.uk/   had some different approaches that may work in a more cost effective way.

Thanks, will pass that on. Looks like it still requires the employer to do the paperwork though...

Green Commute is pretty flexible in my experience  ;) - they worked out a get-around for the original £1,000 limit ... seemed like a fiddle but was perfectly legal .... worth talking to them direct

Re: When your employer isn't on a cycle to work scheme...
« Reply #15 on: September 11, 2020, 12:45:42 pm »
The employer doesn't have to use a scheme provider. They could just pay the shop directly, and set up a salary sacrifice arrangement to repay it.
Would mean no extra admin fees.

This.  Sure, there is a time cost to the employer, but salary sacrifice doesn't seem that unusual nowadays to sort out.

I haven't done it because last time I wanted to, the rules seemed to keep getting reinterpreted around final purchase price, and I didn't want the hassle of figuring out what the correct interpretation was when the benefit appeared to be shrinking quite a bit.

robgul

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Re: When your employer isn't on a cycle to work scheme...
« Reply #16 on: September 11, 2020, 05:32:20 pm »
The LBS has to give up 10% to most of the schemes and 15% if it's a Halfords vouche[/i]
It's understandable why independents would dislike the Halfords voucher, but if the bike is available from them it's usable on all bikes including those reduced in a sale.  It's certainly unfair that they've been allowed to be administrator and supplier, but from a purchasers perspective it's probably the best voucher to have, if Halfords can supply the bike you want.
The high transfer of ownership cost came about when HMCE clarified that giving it away was a benefit (I'm surprised anyone ever considered it otherwise) it didn't take long for the scheme providers to find a legal way around it by extending the period of time, lowering the value, before that transfer.
I dislike the scheme, those on low pay who would most likely benefit are excluded, whilst those buying new toys every year are rewarded.

Not sure that you've got the right end of the stick re Halfords - my understanding is that :

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) and you buy the bike from Halfords you pay RRP, not a sale price (at store level there's probably an unofficial deal to be done?)

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) then the LBS can supply any bike brand but must give up 15% of the sale price.


To add to earlier comments - there is quite a lot of abuse of the whole tax benefit scheme - I had a customer who bought an Ultegra crank power-meter set (can't remember the brand) using the voucher to offset payments against his higher rate tax - he called to collect it in his very large 4x4 vehicle of the variety manufactured in Warwickshire . ..  . oh, and he'd bought a £900+ bike on the scheme for his wife in the previous purchasing window for which he was eligible (not from me)

Re: When your employer isn't on a cycle to work scheme...
« Reply #17 on: September 11, 2020, 07:30:20 pm »
Not sure that you've got the right end of the stick re Halfords - my understanding is that :

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) and you buy the bike from Halfords you pay RRP, not a sale price (at store level there's probably an unofficial deal to be done?)

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) then the LBS can supply any bike brand but must give up 15% of the sale price.

No, all the Halfords brands accept Halfords vouchers against discounted items, always have, I administered a scheme about ten years ago and it was the case then.  Here's what Tredz say (First google hit)
Quote
Yes, you can use your Cycle to Work voucher on any discounted or clearance bikes and eligible accessories.
https://www.tredz.co.uk/help-advice/customer-service/shopping-services/cycle-to-work/halfords-cycle2work

Cyclescheme have also signed up some of the bigger players to commit to accepting vouchers for discounted bikes
https://www.cyclescheme.co.uk/community/featured/sale-bikes-on-cyclescheme

It is tough for the small independents, even tougher if they don't understand what they're up against.

robgul

  • Cycle:End-to-End webmaster
  • . . cyclist, Cytech accredited
    • Cycle:End-to-End
Re: When your employer isn't on a cycle to work scheme...
« Reply #18 on: September 11, 2020, 07:48:02 pm »
Not sure that you've got the right end of the stick re Halfords - my understanding is that :

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) and you buy the bike from Halfords you pay RRP, not a sale price (at store level there's probably an unofficial deal to be done?)

- if the employer uses the Halfords scheme (i.e. as the manager of the scheme) then the LBS can supply any bike brand but must give up 15% of the sale price.

No, all the Halfords brands accept Halfords vouchers against discounted items, always have, I administered a scheme about ten years ago and it was the case then.  Here's what Tredz say (First google hit)
Quote
Yes, you can use your Cycle to Work voucher on any discounted or clearance bikes and eligible accessories.
https://www.tredz.co.uk/help-advice/customer-service/shopping-services/cycle-to-work/halfords-cycle2work

Cyclescheme have also signed up some of the bigger players to commit to accepting vouchers for discounted bikes
https://www.cyclescheme.co.uk/community/featured/sale-bikes-on-cyclescheme

It is tough for the small independents, even tougher if they don't understand what they're up against.

I stand corrected - I haven't managed the shop since November 2019 - my recollection was from an employee of a Halfords voucher using employer who came to us having been thwarted at a Halfords store, IIRC he wanted a Boardman   - he bought a previous season Bianchi that I had in stock and was keen to get rid of  :thumbsup:   

The real killer for the LBS was the 10 or 15% cost they had to bear.


Pedal Castro

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Re: When your employer isn't on a cycle to work scheme...
« Reply #19 on: September 12, 2020, 07:33:18 am »
The employer doesn't have to use a scheme provider. They could just pay the shop directly, and set up a salary sacrifice arrangement to repay it.
Would mean no extra admin fees.

Except the cost of the time for the internal person to do that admin...

Which is negligible. The biggest issue for the employer is cost as they have to pay for the bikes initially. If there is only a couple, no problem but rolling it out and encouraging all employees to take advantage could be expensive especially for a small business.

Re: When your employer isn't on a cycle to work scheme...
« Reply #20 on: September 12, 2020, 10:21:24 am »
I would say cycle schemes are intended for larger employers. The tax breaks for the employer and employee are available without a scheme and much better prices can generally be achieved, however it does need an willingness from the employer.

Re: When your employer isn't on a cycle to work scheme...
« Reply #21 on: September 12, 2020, 10:32:18 am »
Except the cost of the time for the internal person to do that admin...

Which is negligible. The biggest issue for the employer is cost as they have to pay for the bikes initially.
Isn't that the case whether they use a scheme or do the administration themselves?

Re: When your employer isn't on a cycle to work scheme...
« Reply #22 on: September 12, 2020, 10:47:07 am »
What are your options when your employer isn't on a cycle to work scheme and can't be persuaded to sign up? Are there any other legit ways to take advantage of the tax breaks?

I believe the official advice is find a better employer.
J
A bit extreme, just because of a bike. :P

Re: When your employer isn't on a cycle to work scheme...
« Reply #23 on: September 12, 2020, 11:14:33 am »
A bit extreme, just because of a bike. :P

It's less extreme than moving to a better country.

quixoticgeek

  • Mostly Harmless
Re: When your employer isn't on a cycle to work scheme...
« Reply #24 on: September 12, 2020, 02:27:47 pm »
A bit extreme, just because of a bike. :P

It's symptomatic of wider issues. Suggests they don't take the needs of their employees seriously, not willing to make efforts to reduce environmental impact of their business, not willing to listen to what their employees are saying.

It may not be a red flag, but it's certainly a waved yellow.

J
--
Beer, bikes, and backpacking
http://b.42q.eu/