MegaSack DRAW - This year's winner is user - rgwb
We will be in touch
Somehow i have been nominated at my work to drive the implementation of a cycle to work scheme in our company. So, early days in this venture, and i have a little bit of time available as i am not commuting just now...
Questions to those who have gone through this or run them.
Who did you use and why as a provider
Do different providers control what shops you can use?
Do different shops only work with some providers
I know the limit is now off, but does yours have a limit and why? is this a risk control incase you and the employer goes your separate ways?
If this does happen, how does the company keep its asset, or is it "reclaimed" in the last salary paycheque, what if this is not enough (say a £5k bike and salary £2.5k a month?)
Thanks for your help.
Dave
Hi Dave,
My employer (a school) are with cyclescheme who have an excellent website where questions of employers and employees are answered. My employer set a £10000 limit for vouchers and a I guess a handful of staff could take advantage of that. I'm on an average good salary and my employer was happy for me to repay the voucher over 24 months which keeps my payments low (normally covered by paid lunch duties so win win). Cyclescheme offer 3 options and I went for the own it and the end of agreement one. My voucher/certificate came to £2699 and after 24 months of using a salary sacrifice I will have effectively paid £18000 for the bike and only have to pay 1%-3% of the purchase cost as a one off payment to keep the bike which after a set length of time (can't remember how long) I will own the bike outright. The rules for early termination are pretty strict because of the tax implications. See the clause from my hire agreement below:
Termination Fee: If You cease employment with the Employer, this Agreement will be terminated in accordance with section 2 of the Agreement and the tax exemptions available under the 'Cycle to Work' scheme will no longer be available. You will be required to pay the total outstanding Payments due for the remainder of the Hire Period. The outstanding balance payable will not benefit from any tax exemption and will be collected by the Employer from any remaining net salary payments and other sums payable to You by Your Employer. Should this not be possible for any reason, or if the total outstanding balance of Payments due exceeds any remaining net salary payments, You agree to promptly pay an amount equal to the total outstanding Payments due for the remainder of the Hire Period to the Employer directly within fourteen (14) days of Your employment ceasing.
Check out the website...
Cheers
David
Good info, thanks, i assume you have some extra zeros in there, as £18k for a bike is quite steep.
Why do you need to use any provider? Most of the providers charge an admin fee, maybe 10%.
The employer could just pay the shop directly.
Doh, yes indeed, well spotted it should read £1800...
One to aware of is that cyclescheme do not do YT/Canyon/Rose. Bit annoying if that's what you want.
Green Commute Initiative look more flexible and easy to use but haven't looked at details of T+Cs.
If you want to go over £1k then you’ll need to use cyclescheme/green cycling imitative or similar as they have the FCA licence (unless your employer has the licence already)...
I agree with LD, Green Commute Initiative do look more flexible particularly with end of agreement ownership. Cyclescheme were already in place and the business manager didn't want to change provider understandably. In fact I had to wait a couple of months for Cyclescheme to raise the limit to above £1000.
I doubt we have a FCA licence but will ask. @CraigW ,so we can just ask our accounts to set this up ourselves, as a salary sacrifice type scheme presumably?
Thanks for info!
i think it's straight forward for an employer to DIY (especially for a small number of participants) but you'll be stuck to the £1k limit unless you have the FCA licence.
It would be a good way to make yourself quite unpopular with your bosses if you got that wrong 😉 For example - https://www.accountancydaily.co/sophos-sale-nearly-punctured-salary-sacrifice-bike-scheme