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Why commuting anyway? Someone riding at the weekend is improving their health and possibly costing the NHS less long term.
Because commuting is a double whammy.
If you look at it i terms of it's impact on life expectancy 1 hour spent in a car reduces your life expectancy by 20min on top of that hour you just spent being economically inactive. Riding a bike is a net gain of 1 hour, or to misquote the Babylonians "The gods do not deduct from man's allotted span the hours spent cycling".
Someone riding at the weekend might drive somewhere to ride their bike and that just adds to congestion. Especially if you " need" giant 4x4 or van to go cycling.
That and it was covered way back on page 1. You'd have to apply the same logic to all sports goods, from darts to £100 replica football shirts.
You'd have to apply the same logic to all sports goods, from darts to £100 replica football shirts.
Ignoring the fact that bikes are as much 'transport' as 'sporting goods'. Or could be, if only there was a scheme to promote them as such.
Sports shirt and darts don't have tax breaks.
Forgive me if I have missed a post in this drivel.
Does your work offer this? I mean does it know you’re not buying a bike to commute on?
First year was a commuter bike, which i do use often... to ride to work.
Second was a T-Type GX transmission for my Raaw.
This year is a T-Type XX transmission for my Chisel FS.
Its a scheme that is available and i can benefit from. 40odd % off bike stuff... yes please!
One of the very very few benefits my work has to offer, so i will take it.
Curiously the salary sacrifice for an electric vehicle (helloooooo Renault 5!) makes no such requirements
A friend of mine picked his 5 up this week. Had to get it before March 31st to get his £6,000 tax break. Makes CTW bike tax advantages look like a rounding error. And it won't be used to get to work... his ID Buzz Cargo is being used for that (big tax break on that when he got it as well). Both ace vehicles.
Does your work offer this? I mean does it know you’re not buying a bike to commute on?
The only involvement of the employer is approving the voucher request. They have no idea what you are going to spend it on.
I bought a bike, which used to get ridden to work about as much as it got thrashed round the forests before it got reduced to TT duties. Then I bought a coil shock, which is on a bike I now ride to work, occasionally. Then I bought a wheel set, for the same bike. Most recently I bought a set of 38s for a different bike. Not decided on what my next purchase will be; possibly a bike, but more likely T Type for my favourite bike.
I'm a lower rate tax payer, so any saving I can make is extremely helpful.
Why commuting anyway? Someone riding at the weekend is improving their health and possibly costing the NHS less long term.
Well cycling on the weekends is a your own business, sure it's good for your health too, but it's a leisure activity. Cycling as transport for was explicitly what the whole "cycle to work" scheme was seeking to encourage. You might as well ask why you can't have a skiing holiday as an income tax reducing salary sacrifice, it's a healthy activity, but it's entirely your choice and you're not doing it to reduce demand on the NHS, you're doing it for your own enjoyment and gratification.
Subsidising/providing tax breaks for the middle classes weekend toys isn't in the title, or it seems the Ts&Cs that nobody bothers to read. Technically HMRC could go after all the people not in compliance with the 50% commuting rule for what? fraud(?) I doubt they would (currently). It is sort of annoying for the few of us who do play by the rules and choose not to abuse C2W.
Like I said I'm all for it being spending capped, and ideally then policed (as far as is reasonably practicable), that should of course come with a bit on an amnesty I reckon, let people finish of their last little go misusing the scheme, and then that unearned little privilege is quietly withdrawn.
The only involvement of the employer is approving the voucher request.
The question is should they and can they check in many cases? When people were taking the piss too much there was a court case enforcing slightly stricter standards* and given how the current government are announcing crackdowns left, right and centre an obvious candidate is to start demanding c2w is used for, well cycling to work.
Where I work sent out a note about employees checking their eligibility and in theory the company could be held to account for it eg currently I can elect it but as a homeworker with no designated office it wouldnt be unreasonable for me to be ineligible unless I managed to explain otherwise.
For a fair few companies with limited parking an obvious question would be why someone who gets one of those rare spaces is also using c2w.
*for the nerds. c2w is the effective equivalent to a car PCP loan where if you want to keep the car/bike you need to make a final payment which can be fairly substantial. The schemes used to last a year and then the bikes were being given away which, for a 1k bike, was slightly questionable.
Its why now if you read the paperwork the schemes now last up to about 5 years (even if you just pay for 1 year) to make the final payment amount tiny.
NBD! New Bike to Work Bike collected yesterday. And thus far 100% of its journeys have been to or from work. Very pleased with it too. Bought from my favourite real bike shop, Condor Cycles because we need proper bike shops in central London.
NBD! New Bike to Work Bike collected yesterday. And thus far 100% of its journeys have been to or from work. Very pleased with it too. Bought from my favourite real bike shop, Condor Cycles because we need proper bike shops in central London.
I had a gorgeous Condor Fratello in Ferrari Red for a couple of years. Wrote off the frame colliding with a pedestrian as we came out of lockdown.
Its why now if you read the paperwork the schemes now last up to about 5 years (even if you just pay for 1 year) to make the final payment amount tiny.
Also worth checking how much the payment is.
Halfords is free, Cyclescheme is 7%.
Which surprised me, but I guess explains a bit why Cyclescheme charges retailers less, and offsets the fact that a lot of retailers charge you more to use the Halfords vouchers.
And I'm not sure why they differ, HMRC say it's zero as long as the hire agreement is for 6 years. I guess they just want another slice of the pie.
See how much a used five year old Brompton is selling for. I paid £600 for a new one in 2002. I could have sold it for the same now. My last C2W ran five years and I paid nothing for a dura ace Defy Advanced SL. The latest C2W Brompton was 7x that first one. It’ll be worth more than £316 in five year time!
Halfords is free
This is who our work uses to manage the scheme. Previously it was Cyclescheme where there was a final 7% of value payment. The Cyclescheme 'hire' period was 4 years in total; Halfords scheme is 5 years total.
See how much a used five year old Brompton is selling for. I paid £600 for a new one in 2002. I could have sold it for the same now. My last C2W ran five years and I paid nothing for a dura ace Defy Advanced SL. The latest C2W Brompton was 7x that first one. It’ll be worth more than £316 in five year time!
I wasn't saying that the HMRC guidance is grounded in reality. If they were it'd be ~50% after year 1 and no one would take part in the scheme.
I'm just pointing out that some schemes are effectively charging you extra. That's them making an extra profit despite the intent of the schemes being that the value of the bike was divided by 12 to determine the hire cost. Nothing to do with HMRC. In theory the scheme could demand the bike back without a choice and sell it on ebay to determine the market value.
Halfords let you run down the value to zero (6 years), cyclescheme offer you 7%, (4 years).
Day 1:
You get a £1000 bike
The bike shop gets ~£900 depending on the schemes admin charge and the customer has no visibility of this unless the shop passes it on to them.
Day 31/61/92/etc:
The scheme gets £83.33
Day 365:
The scheme now has £1000, including the original admin charge
Cyclescheme then ask you for another £70 (which is taxed)
Halfords ask for nothing
Legally (and I'd suggest morally) Cyclescheme could charge you zero as well as they've already been paid the value of the bike plus a profit margin.
I'm just pointing it out because it was something I wasn't aware of until I did some digging that although both schemes are effectively charging ~15% admin fees, Halfords charge it to the shop on day 1 and the customer just just paying for the bike tax-free. Cyclescheme are more expensive to the consumer.
Either Cyclescheme or GCI charge a quid at the end. Can’t remember which as we have both running in our house for the wife and I (her’s will have all the nicest bits stolen from mine as per usual).
Either Cyclescheme or GCI charge a quid at the end. Can’t remember which as we have both running in our house for the wife and I (her’s will have all the nicest bits stolen from mine as per usual).
It's GCI. We use CycleScam at work and they charge 7%. I suggested they change provider but it's managed by an outside company who provide other "benefits" like the STW ones.
I was OK even if Cyclescheme charged a bit as Balfes allowed me to buy a bike that was already 50% off and then with C2W applied on top for no cost... made it a no-brainer.
I've never used a bike scheme to buy a bike, even though I bought four during my spell as a postie, as a 3-day PTer (22.5hrs) I wasn't that sure I would qualify when my gross pay was roughly £250 in 2010 rising to ~£300 per week due to the "minimum wage" clause (based off 37.5hrs of min wage?). The RM scheme was also rubbish in my early days, limit of £500 bike iirc.
Didn't some bike schemes begin officially allowing the purchase of parts in recent years, instead of buying a bike?
Condor said I could buy whatever I wanted and top up as needed. Somehow a 10k track bike would probably fall the 50% journey to work test though! And unlike an amateur team I know, I can't put it through the company books as a tax expense 🙁
We use CycleScam at work and they charge 7%. I suggested they change provider but it's managed by an outside company who provide other "benefits" like the STW ones.
Those outside provider types are always a total scam. They approach businesses offering to manage all the HR matters, take all that burdensome admin off the hands of the poor overworked HR folk leaving them free to conduct interviews and do recruitment etc.
Then they come up with a list of "perks" like 1.5% off at CenterParcs if you stay Tuesday to Thursday in February or 5% off at Boots when you spend £250 or more in one transaction. And they'll run the C2W with a series of limitations on price, has to be bought in Halfords, has to be used 4x a week for riding to work...
The one at my previous place was absolutely terrible. I tried to get it changed but after a lot of back and forth, HR eventually said they'd increase the limit from £1000 to £1500. So still useless then. 🙄
"The percentage of those 100k earners spending money via C2W (when lots of big companies still cap it at 1k) to get under that threshold compared to putting it into a pension will be minuscule"
Just for balance, the majority of the people I know who earn over 100k (large corporate so a fair number of people) have done this and those that haven't salary sacrifice for a car. They also chuck a lot of money into pensions. Most of them would point to the money they lose from child care etc by going over 100k as being unfair.
"The percentage of those 100k earners spending money via C2W (when lots of big companies still cap it at 1k) to get under that threshold compared to putting it into a pension will be minuscule"
Just for balance, the majority of the people I know who earn over 100k (large corporate so a fair number of people) have done this and those that haven't salary sacrifice for a car. They also chuck a lot of money into pensions. Most of them would point to the money they lose from child care etc by going over 100k as being unfair.
so the 1k on cycle to work is probably very small compared to the pension relief. One has tangible benefits for pollution, health etc if used for commute, earning 120k and putting 20k into a pension doesn’t.
I get it’s abused and that’s wrong, I’ve never used it myself as the residual payment doesn’t make sense to me nor have I had an employer who offered it, but to me it’s more a point scoring anti cyclist news story then anything effective for saving tax for the gov
If the Telegraph wants to look at the tax gap I'd suggest they look at where the real offenders are.
While I'm ideologically opposed to improperly taking out a C2W bike there are a very large number of much higher value and higher frequency issues that impact the tax take to a much greater level monetarily. This is a teaspoon in the North Sea.
Have a read of the below... Current(ISH) estimates are that 60% of the tax gap comes from small businesses with small business under declaration of Income and Corporation taxes being two of the big drivers.
https://www.gov.uk/government/statistics/measuring-tax-gaps/1-tax-gaps-summary
It’ll be the bus or Shanks’ pony.
That's if there is a bus. Not necessarily the case in rural/remote areas.
That's if there is a bus. Not necessarily the case in rural/remote areas.
That rather misses the point of the post you were quoting from.
That the people at the bottom of the economic pyramid are the ones that don't have a choice about car ownership, they just don't have a car. Yet because of the way the scheme is structured, they can't benefit from it either.
And for context the poverty rates based on relative low incomes in the UK are 17% in rural areas and 24% in urban areas. And 84% of the UK lives in an urbanized area. The straw man under discussion is the fraction for who cycling to work wouldn't be an option, for less than 3& of the population.
And as an ex-rural bumpkin now suburban city-slicker [ha, NOT] I still think that at some point people who chose to live in nice places can deal with the consequences of their own actions or if they really do live in the house they were born in and have never moved, in-actions. I have a nice 3 mile bimble into the office, the price I pay for that is having to deal with having neighbors. I'd really like to go back and live somewhere where the only assholes I have to deal with are the sheep, but then I'd accept that it's not then the governments job to subsidize my commute back into civilization.
It’s money off a bike. It’s great.
I cycle to work nearly every day. Just about to get my 2nd C2W in 4 years.
From my circle of friends It’s lots and lots more bikes on the roads/trails. People do it to save money and it’s a shiny new bike, never heard anyone do it because of its tax threshold avoidance, it’s got to be a tiny number.
One friend got a c2w bike which was nicked within a month. Not sure how he would have proven he was cycling to work on it. And they don’t replace it if it’s nicked. It’s treated as yours, do what you want with it. So commute on it or don’t or leave it the shed.