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I’ve never earned a high enough wage to be a beneficiary of the scheme but whilst working in the shop I saw exactly how the scheme was used/abused
Completely agree I got a £8,200 bike last year for roughly half that amount. IMO the true value of the bike would be the £4,500 it actually cost me.
However I don’t know anyone who can afford to walk in to a bike shop and spend £8,200 on a bike
The industry is going to have to do some serious rethinking on its RRP for products as top end bike just are not going to shift after this and further taxes that will be put on to wealthy people.
I don't think it should be scrapped necessarily but am comfortable with it being capped at something like £2k.
I've used it two or three times and not once cycled to work. Think the most I spent was around £1600? I happily would but distance and the danger of the road I use stops me. Obviously I may be able to work closer to home soon and the worst bit of the road is getting a huge upgrade just in time for any changes in C2W to kick in! 😆
I also have a salary sacrifice car. When it started the idea was to get people out of heavily polluting vehicles and in to the £30 tax bracket ones which seemed like a sensible thing to do. I guess it's less effective these days as virtually every car falls in to the lower polluting bracket although it's boosting a shift to EV's now (whether that's good or bad is up to you?). Anyway, it's not really that much cheaper than going to a garage and buying on PCP or lease unless you find a very specific deal floating around.
It's certainly driven inflation in the bike industry higher than CPI. That said I can't see bikes dropping in price to reflect that.
As an aside - how old is that picture on the Guardian article!!
Bike industry inflation is nearly all cost driven. If demand for bikes is further reduced, it’ll mean more shops close and more brands are sold to the likes of Mike Ashley for peanuts and turned into labels stuck on cheap rubbish.
How much revenue will it actually bring in?
Or is it a case of every little helps ?
If the point is bringing in money, the fuel duty escalator needs to restart. The duty cut reversed etc.
If the point is politics then go ahead and target C2W, and yes the scheme isn't perfect, but it currently suits certain large companies who cream admin fees off every transaction.
The industry is going to have to do some serious rethinking on its RRP for products as top end bike just are not going to shift after this and further taxes that will be put on to wealthy people.
More shops go bust, brexit bumped prices because of import duty, that UK wages have been falling for decades relative to everyone else further erodes value. Welcome to a global market where the UK isn't that important.
Sample size of 1, but my C2W bike gets used most days to cycle to work.
Yes, it was expensive, because I wanted a bike that would be (a) nice to ride and (b) nice to look at, but its main use is cycling to work.
But to be honest I think this has nothing to do with fixing perceived problems in the scheme. It's much more that Labour just fancy having a go at higher earners. Reverting to type. Disappointing, but hardly a big surprise.
But to be honest I think this has nothing to do with fixing perceived problems in the scheme. It's much more that Labour just fancy having a go at higher earners.
It reads like the bad old days of Tory "government". Leak a policy idea to the Daily Mail and if it's popular, run with it.
This ticks all the boxes. Nice bit of anti-cycling rage bait. Higher earners (ssshhhh, don't mention the SUV drivers!). Tax breaks for Them.
Doesn't really matter that actually it'll make bugger all difference to the Treasury bottom line or the tax bill. It's very important that you're Seen To Be Doing Something even if that Something is worse than useless.
But to be honest I think this has nothing to do with fixing perceived problems in the scheme. It's much more that Labour just fancy having a go at higher earners. Reverting to type. Disappointing, but hardly a big surprise.
And look at who actually voted Labour... not who Labour think are their supporters.
Labour just fancy having a go at higher earners. Reverting to type
And that would be logical if an election was just around the corner ..... remember the tax on private schools which was just a vote winner and nothing more.
Slight tangent to the main thread, but I bought a new lawnmower recently from a Honda dealer. it made me absolutely realise that something is very wrong in the push bike industry. I could buy an almost new sports motorbike or enduro motor bike for less than I paid for my emtb last year (ok mtb before SS) . These machines are engineered to far higher standards than mtbs and comparable /cheaper in price. If it wasnt for there being an increased chance in death driving a motor bike, I know where I would be going
Should have bought your emtb second hand then. Why do people always compare apples to oranges when looking at motorbikes and e-bikes (or any bike)?
You can get a £3750 grant to buy an electric car. Here you go, just short of £4k, thats yours. enjoy.
They could give away Tern Quickhauls for less money.
Ive never used C2W, ive always thought it was stupid it mainly seems to be spent on s****y mountain and road bikes, and fancy lights. They would be much better getting sensible e-cargo bikes into the hands of people who cant afford them, rather than subsidising IT consultants hobbies.
even if theyre not used for C2W, getting suburban people out of their cars is valuable. I dont know anyone who has tried an e-cargo bike and not been converted. Possibly a self selecting sample, as you need to be able to commit a few £k to try one out, but still.
I could buy an almost new sports motorbike or enduro motor bike for less than I paid for my emtb last year (ok mtb before SS) . These machines are engineered to far higher standards than mtbs and comparable /cheaper in price. If it wasnt for there being an increased chance in death driving a motor bike, I know where I would be going
They look fancy on the outside, but inside is often incredibly rudimentary.
The frame? Ducati made a big deal about making their high end frames from CrMo, the rest (even at ducati) are made from alloys you'd turn your nose up at on a bike (both steel and aluminium) and carbon isn't really a thing beyond cosmetic trinkets. And you can forget about beautiful TIG welds on all but the fancy bikes it'll be a bit more agricultural and covered in thick powder coat.
The suspension, RockShox has Charger Damper, and somewhere below that there's the Motion Control Damper, and somewhere below that is the Turnkey damper, and somewhere below that is this thing which is the typical damper from Showa forks. The little springs are there so you don't lose your fillings when it tops out. No shims, no check valves, no adjusters just some holes drilled in a flared steel tube.
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The engines and gearboxes, yea there's more going on there than an e-bike, but probably less than you'd think (because we're talking simple motorbikes that cost about the same as a push bike, not a £34,000 Goldwing).
remember the tax on private schools which was just a vote winner and nothing more.
It's another perceived "easy" labour win isn't it?
Higher earners/tax payers getting 'another' tax break, stokes the fire meanwhile Labour will just shaft everyone but the very rich and mega-corporations and blame it on those getting the perceived breaks.
Value of bicycles accessed through the scheme % of Cycle to Work Scheme users
Under £200 8%
£201 to £400 16%
£401 to £600 21%
£601 to £800 9%
£801 to £1,000 21%
£1,001 to £1,200 5%
£1,201 to £1,400 2%
£1,401 to £1,600 6%
£1,601 to £1,800 1%
£1,801 to £2,000 3%
£2,001 and over 6%
Don’t know or can’t remember 1%From here. Not immediately clear whether that is just from their sample or all users of the scheme.
Hmmm,
Noting:
The survey interviewed 438 individuals who had used the Cycle to Work scheme in the past 5 years (between 2017 and 2022),
From those 2017-23 figures (gathered from 438 interviewee's memories, not an actual dataset?) it looks like the encompassed £400-1000 Bracket(s) account for a substantial chunk (~%50) and that maybe the perception that I and other have that the scheme is widely abused is incorrect and maybe sits at less than %6 of C2W users (???)...
I'd Still Cut off the high earners and set a £2k cap (Pretty much the modern inflation adjusted equivalent of the 1999 £1k cap) for normal (un-assisted) bikes, a higher cap for eeebs would be appropriate (IMO).
I also wonder if the %24 covered by the Sub £400 brackets is more accessories/parts than bikes? - Considering that a Tourney equipped Carrera Subway is most normal people's idea of "a Basic Bicycle" and is available today for ~£350, a bike in that lower bracket is entirely available today, we can argue over it's quality and/or suitability for commuting.
The only reason there’s a bigger saving for higher earners is because they’re paying a higher tax rate to start with - it’s not like the intention of the scheme is give bigger benefit to higher earners
Irrespective of intention, the outcome is still that higher rate earners save proportionately more than those on a basic rate.
That's not really what I'd consider 'fair' and/or equitable if anything it should be the other way round, i.e. those with fewer means should save proportionately more with C2W.
Wealthier people don't deserve (or in fact need) bigger financial breaks from the state... To be clear I'm talking about myself here, I pay a higher rate, I do have the means to buy a decent commuter bike without assistance from government I don't feel it is morally right for me to be handed a bigger benefit than someone who earns less...
Should have bought your emtb second hand then. Why do people always compare apples to oranges when looking at motorbikes and e-bikes (or any bike)?
A new Honda CB500 Hornet is £1k less than an Orbea Wild M10. I think he has a point.
These machines are engineered to far higher standards than mtbs and comparable /cheaper in price. If it wasnt for there being an increased chance in death driving a motor bike, I know where I would be going
This is such a fallacy. Cheap motorbikes are just a collection of cheap heavy parts - badly welded steel frame, couple of square bars for the swingarm, Halford's special equivalent suspension, brakes that are just big lumps of cast aluminium joined by some hose, cheap plastic mass-produced dash, and the thinnest, cheapest paint going. There's some work goes into the engine obviously, but they are used across several models for decades. When Suzuki brought out the GSX8S in 2023, that was the first new road bike engine for them since 1999 IIRC.
A new Honda CB500 Hornet is £1k less than an Orbea Wild M10. I think he has a point.
Apples and oranges again. Why skip over the Orbea Wild H20 for that comparison?
I've said it a million times, but a scheme where manufacturers/dealers could submit a model to be verified as a commuter/shopper specific model and if approved it is sold without attracting VAT.
Could do the same for company car schemes as well 😆
But I definitely get the point about a fit-for-purpose bike for big commutes etc. A typical town bike wouldn't cope with the commute I do: not gnar offroad or going (too) far out my way to take in nice trails, but more in seeking traffic-free routes that are rough enough to warrant a wide-tyred touring/gravel/hybrid.
I know many folk who abused the BTW scheme big time - work colleague even used their friendly LBS to acquire a £2k set of TT wheels for their TT bike. I can smugly say I used the scheme once with a total spend of £1,000 on a Cotic Roadrat which I used/abused on the commute for 8+ years before it got flattened under a car.
Whatever the flaws in the C2W system what is worse here is that Labour have consistently missed the mark. This will only hurt typical Labour voters.
The UK is suffering from huge disparities between the rich and everyone else.
Labour should be looking at taxing large corps and the ultra wealthy, start at the top. They have gone for everyone except the top, way to go, piss off all your voters.
Note I have only ever voted Labour in generals and vacillate between labour/libdem/green for locals, I am centre left, I imagine that most users here based on what I have read so far. I soooo want Labour to do well, but it has been deeply disappointing so far.
or overpaying 9.5bn in benefits due to fraud and system error as a taster examples
Just to point out that this is actually an improvement on the preceding 5 years of the Conservative government. So you should really be celebrating Labour 😉
Anyway, that aside, a couple of commenters have mentioned that there really is a valid use for expensive bikes on C2W.
Personally speaking, i've got Long COVID and would be driving to work if I couldn't have got an ebike on the scheme. It was £2500 and is a fairly bog standard Cannondale hybrid with lights, mudguards and a rack, but it keeps one more car off the roads. My colleague actually sold her car and went down to a 1 car household after getting a Tern Cargo bike to take the kid to nursery on the way to work. That one was REALLY expensive, but this kind of thing is exactly what the C2W should be helping us achieve, IMO, and there are loads of people out there (including about another 3 in my office) who would never have DREAMED of riding a normal bike to work, but happily commute by ebike.
The scheme does need to be reformed. But in terms of getting people out of cars, they need to be careful about how they do it.
A bike bought through C2W still incurs VAT, tax on the business that sells it, tax on its employees’ salaries, tax on the C2W scheme providers and duty on the imported parts.
The salary sacrifice is just a free lubricant which generates all those other taxes, whilst encouraging people to do something wholesome and healthy with their disposable income.
Given this is a cycling forum I'm quite shocked as to how anti cycle to work some people are. I think with a lot of people who are against the cycle to work program more because they perceive it benefits people who are not them....
Here in lies the problem, does the scheme have problems? Yes it does, does it need to change probably not. There are far more important things to tinkle with in the budget that will bring in far more money than changing or limiting the cycle to work scheme.
If, this is to happen then I suspect that it is more around looking like you're doing something whilst actually not doing anything at all. Taxing the super wealthy would actually bring in some real money, attempting to tackle the massive benefits bill, would bring in some real money. Capping or reducing the cycle to work scheme will probably not only not bring in any extra money (or even save any money) but long term will probably cause massive problems for the bike industry.
If they reduce, scrap or cap the cycle to work scheme I think it will be an own goal and will help drive middle-class voters in the direction of reform.
Personally speaking I'm more worried about what might happen in the budget around pension contributions and isa limits. Anyway let's keep to some decent class warfare here as it's absolutely fascinating to see people's quite rabid opinions
Quite right to cap, but needs to be open to those on the minimum wage
I agree, it should also be open to everyone who has a job...my employer won't do it, just flat out refuse
Anyway let's keep to some decent class warfare here as it's absolutely fascinating to see people's quite rabid opinions
Woof…..woof….
Ignore
It’s not perfect and you can argue about the detail of who benefits most but if they take the scheme away, we will lose something that is generally good for cycling and it probably won’t be replaced by something better. I have used it a few times and I have used it for bikes I commute on.
I think e cargo bikes should be supported by the scheme and they are expensive so capping it any lower would be a shame.
I suspect that if they scrap it they will do so to save cash and not to find a better and more effective way to promote cycling. As for alternatives… I think that the best way to invest in cycling in the UK would be to provide (much) better infrastructure… I don’t know how much the current scheme costs the govt and therefore how much infrastructure it would buy.
I have had a c2w scheme available to me for over 20 years. Up until last month I had never used it. I commuted to work on a Boardman Team CX, then a Pinnacle Arkose, then a Carrera Crossfuse ebike. All bought second hand. Even the ebike was only £700.
In October I had a casual look and saw £4k bike reduced to £2k, then after tax savings, less than £100 per month from my pay for 12 months. I snapped it up. Will I ride it to work? Rarely. But I do ride to work often on my £700 Carrera ebike.
I agree, it should also be open to everyone who has a job...my employer won't do it, just flat out refuse
Yep, I had years of either no C2W or a scheme so shit it wasn't worth bothering with.
The fact that one anti-cycling **** in the finance or HR department could scupper a scheme for dozens of people was always a massive point of failure in the whole thing.
It needs to be opened up to the self-employed and those on low income - perhaps subsidised by the higher earners.
Given this is a cycling forum I'm quite shocked as to how anti cycle to work some people are.
I am not sure anyone is against people cycling to work its just me and others dont see the connection to the scheme and think the money could be better used than for toys for us middle class it managers.
When I was in the office there was a reasonably good take up of cycle to work scheme but it wasnt matched by people actually cycling to work luckily.
I say luckily since there were two showers (one male one female) in a rather large office building and a secure(ish) cycle rack buried deep in the underground carpark which could hold probably 20-30 bikes.
Think my company had, at peak, about 500 staff there and other companies another thousand or so.
Think had to queue for showers a handful of times at most and by queue I mean wait for the person in the shower to finish vs a proper queue.
I think with a lot of people who are against the cycle to work program more because they perceive it benefits people who are not them....
I've read through the whole thread, and have seen more higher rate payers saying they don't use it because they think it's regressive or admit to abusing the privilege and feeling somewhat guilty about it.
It's a total non issue. A trivial tax loss needs to be set against reduced sales, increased congestion, poorer air quality and poorer health. It's purely about optics. Meanwhile, EV salary sacrifice continues to have no such restrictions, despite being objectively worse than everything except an ICE car.
My C2W bike was bought in 2018 so I don't really have any skin in the game. I bought my EV outright.
Given this is a cycling forum I'm quite shocked as to how anti cycle to work some people are. I think with a lot of people who are against the cycle to work program more because they perceive it benefits people who are not them....
Yeah, it's weird. Fundamentally I reckon the people who avoid a comparatively little bit of income tax with the c2w scheme aren't the problem.
This gets my goat big time - the press and the government (potentially) trying to make out that there's a "tax saving" to be made here - there simply isn't......
Tax breaks like this are all about stimulating demand - i.e. people buying stuff they otherwise wouldn't have.....the same could be said for the 43p/kwh FITs payment I get on my solar panels.....I wouldn't have invested in the panels if the incentive hadn't have been there....therefore no solar panels bought and no market created.
The bike industry in this country has made a bomb from this scheme, in the sense that a LOT of people have bought bikes they otherwise wouldn't have done.
The effect of pulling it, or capping it, will simply be the opposite effect....fewer bikes sold.....the knock on effect on the economy? Slower growth, lower consumption and lower tax take.....it's not "saving" anybody anything.....
I know it's only a small market (relatively) and overall a small impact economically, but I suspect potentially another devastating blow to the bike industry
Absolutely barmy (in my humble opinion)
Absolutely barmy (in my humble opinion)
I think it should be compulsory for all contributors of a thread like this to declare (truthfully) if they have personally used the scheme to enhance their toy cupboard in the past and what that saving has come to over the years. I just get the feel there just 'might' be some self serving in some of the responses. 🙂
Those who see no issue in the current system and think the 'to work' bit was cobblers anyways - I guess you have no problem with it being extended? Running Trainers and football boots? Gym memberships? Kayaks? Sailing boats? Skis? Skiing holidays? Golf clubs? Golf club membership? Polo horses? Where's your threshold?
Where's your threshold?
I vote for kayaks. Backdated so I can get my firecracker.
To be the first to declare.
Never used the scheme despite commuting by bike for about five years every day.
I think it should be compulsory for all contributors of a thread like this to declare (truthfully) if they have personally used the scheme to enhance their toy cupboard in the past
Me, me, me.
I bought a Kona Sutra on the original C2W scheme. It came in under the £1k (hard) limit we had and got a lot of use commuting to and from work as well as introducing me to touring and to (what was yet to be called) gravel. It was my first drop-barred bike, so a bit of a "gateway" to further enhancing my bike collection.
I've since sold (probably) hundreds of C2W bikes when working in bike shops, so I also have some appreciation of the scheme from that side too. I'm surprised at the value figures reported above. Almost everyone seemed keen to maximise their "saving" by as much as they were allowed so lots of £1,000 bikes. Occasionally we might sell something in the £500-600 bracket, mostly hybrids and basic MTBs (this was 12-15 years ago mind).
Absolutely barmy (in my humble opinion)
I think it should be compulsory for all contributors of a thread like this to declare (truthfully) if they have personally used the scheme to enhance their toy cupboard in the past and what that saving has come to over the years. I just get the feel there just 'might' be some self serving in some of the responses. 🙂
Those who see no issue in the current system and think the 'to work' bit was cobblers anyways - I guess you have no problem with it being extended? Running Trainers and football boots? Gym memberships? Kayaks? Sailing boats? Skis? Skiing holidays? Golf clubs? Golf club membership? Polo horses? Where's your threshold?
I will truthfully declare that yes I have taken advantage of the scheme. Yes I have ridden to work on what I've bought on the scheme.
To those lamenting but not all HR departments offer the benefit, this is the same for all benefits. Unless they are one that you claim directly from the government unfortunately it's always up to your HR department to offer these benefits. I used to work in the Netherlands where you used to be able to get the so-called 30% ruling for expats (economic migrants) - I had a friend who worked at another company where HR thought it was unfair and just refused to let anyone claim for it.
Whilst I appreciate that this benefit is unfair, especially to people on lower wages and I really hope that the chancellor does something to help them. At the end of the day getting rid of or capping this particular benefit will make absolutely no difference to the UK in the grand scheme of things. There are areas that they can tackle that would have 10 or 100 times more benefit to the UK. If they do get rid of or cap it significantly I think the knock on impact to your local bike shop will be significant.
I don't normally get political, however I worry that the current government is chipping away at the middle class (as they perceive it to be a vote winner) and not tackling the real problems.
I have bought 3 bikes on the scheme in Ireland, and only the one I bought this year has actually been used for commuting. The other 2,while not used to get to work, allowed me to get out and about on my days off greatly helping my physical and mental health. Surely that’s a win. I think they should change the scheme to “fitness to work” and allow people a limited tax break (say up to £1,000) each year towards theirs health equipment, be it bikes, trainers, kayak maybe even a gym membership or fishing gear, anything that helps you be outside or active. This would hopefully encourage people to get out and be more active, and maybe improve peoples mental health with the added bonus of saving some medical costs in the future.
Double post
I'll be up front first. I've used the scheme 3 times. Once for my Mrs to get her an ebike so she would start riding and get some exercise (she hates the concept of exercise), twice for me. Neither of which have been regularly ridden for commuting.
However, as a very few have pointed out, I think the scheme has benefits outside the directly commercial. Let's face it, we have an obesity and health issue in this country that is costing us all a fortune in health related services. More people taking regular exercise will directly help this. With ebikes, I've seen a marked increase in the number and "type" of people riding bikes. I would say the vast majority of these folks are not commuting to work, but they are being more active than they would otherwise have been.
This is a good thing in my opinion. I firmly believe that C2W is helping people make that decision to buy a bike (if not actually use it). Anything we can do to encourage people to be more active has direct (if unquantified) benefit back to us in reduced stress on our health system.
Taking the financial side of things ... we've all seen a massive uptick in local bike shops and big bike brands going out of business. Imagine what taking away a good chunk of sales will do to that situation. These businesses are paying tax on profits and wages, generating VAT, etc. Depressing an already struggling industry will be a direct effect of capping the C2W scheme too low.
Finally, I personally wouldn't be against excluding the likes of me from the C2W scheme. I'd likely have bought those bikes anyway, and it would have meant me reducing spend in other areas to make the difference. I am privileged for sure and am lucky enough to not strictly need the tax break.
Overall, I'd like to see the attachment to commuting removed and the benefit structure changed to benefit lower income folk more and far reduce the benefit to better off folk. Capping the tax rebate level at basic rate seems a way to do this. Companies will still go for the scheme as it saves them NI contributions and the benefit to the likes of me would be hugely reduced. If they must cap the purchase price, be sensible and cover most ebike RRPs. Looking at the market, that could be around £5-6k.
- Never used the scheme.
- The vast majority of the population don't use the scheme.
- A proportion of people who use it take the Mickey with the scheme
- The tax cost of the mickey takers is tiny Vs the tax gap
If you're not familiar with the tax gap
https://www.gov.uk/government/statistics/measuring-tax-gaps
Overall, I'd like to see the attachment to commuting removed
OK, fair enough - made your point well.
So if it's not a method of transport you are justifying it for but the health side....would you extend it? £5.6bn spent on gym membership in the UK annually - should we be making that salary sacrifice compliant for the same reasons? Skis, boats, outdoor clothing, tennis racquets. Where would you stop and if it's 'just' bikes, how do you justify it if we are no longer trying to scam it as a healthy mode of transport benefit instead of just a health benefit? What makes bikes so special? Why should Brian get his £4K ebike he's going to use at the weekend in the Surrey hills offset against tax and Dave not get his £4K kiteboard setup he'll use on the same day in the Solent on the same deal? And Gyms are way way more likely to be used 12 months a year than bikes - as a use of tax funds surely that would be better value than a bike rusting in a shed?