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Hi
My partner is in the process of buying an bike through the cycle solutions cycle to work scheme. Her employer limits it to £3000, The Bike She is buying is £5,500 roughly so will be paying the outstanding amount herself.
The bit we don't understand is how the final payment. based on fair market value can be worked out when the Scheme Didn't pay for the Bike in full. and also what determines the final payment value.
There is the option to extend the hire period for free. This I assume is to allow the bike to depreciate lowering the final payment value
Any advice would be very much appreciated
Tom
Are cycle solutions and the company happy with the pay off a chunk yourself bit?
The extending bit means the company owns the bike until HMRC think it's worthless and you can have it for nowt.
I might be tempted by a couple of hundred quid overpayment but not a couple of grand. Leaving the company before the bike has depreciated to no value might cause a problem.
I think from a value perspective, as far as cycle solutions are aware, you’ve bought a 3k bike. All other payments/ values are based on this amount.
When you reach the end of the year, you are given the option to either buy the bike for a set percentage of the original value/ loan amount, or extend the loan for a lower set percentage (7% iirc). Once you’ve extended the loan there are no further payments to make. You can also at that point get another voucher for another bike if you so desire.
I had a bike through C2W with Cycle Solutions. At the end of the year I could give the bike back, pay a one-off payment, or agree to keep the bike for 3 years with no further payments. I can't remember what the one-off payment was but I agreed to keep the bike.
Your final payment is usually your 12th monthly payment - that's how ours works - cycle solutions too - i.e. like above, 'agree' to keep bike !
You can’t part fund unfortunately- I asked not long ago. They buy and own the goods outright during the course of the agreement