Subscribe now and choose from over 30 free gifts worth up to £49 - Plus get £25 to spend in our shop
having recently joined a com pany that does c2w and having to sell my old mtb, im looking to get a new one on the c2w scheme.
however i am unsure as to how it will affect my salary - reason being i am trying to budget and dont want to find that my take home is affected by say £50 per month cos im not rich.
i would get a £1000 voucher, and im in the 40% tax bracket.
On cyclescheme?
try this calculator
http://www.cyclescheme.co.uk/calculator
£48.33/month
Plus the end of hire purchase cost
It's salary sacrifice so you pay it out of your gross salary, pre tax and NI. Hence you save if you had to buy it from post tax and NI net salary. If you have non contributory pension amounts then you lose this. In the 40% salary range you should save quite a bit on the standard purchase price. If your company decides you need to pay off the remaining value of the bike after 1-3yrs for you to own it outright you also need to factor this in.
At a £1000 it'll be around £50 off you wage. IIRC that's what mine was.
so id being £50 a month worse off? sounds stupd but that i need to budget and decide if its worth it at the moment.
its the halfords c2w scheme.
Not stupid at all that's how repayment works you need to see if you can afford to pay it back, best to check first like you did then find you're skint.
Im in the 40% tax bracket
errrr.....that does make you rich 😉
i wish it did chew - in fact id be ok if the missus worked.
so just found some paperwork on it. id have a salary deduction of £62.50 gross per month (can never remember what gross means) which by my reckoning means my salary is reduced by £750 over the year if its that simple.
using the salary calcualtor id lose approx £44 per month? on my current tax code
Gross before any tax, NI. Net after outgoings.
I was waiting for the STW 40% / rich comment.
£63 per month is probably if you are on a lower income tax level.
tony what does lower income mean?
...what does lower income mean?
Less than the £41 866 you need to earn to qualify for the 40% tax bracket
Don't forget to offset this cost against anything you might save from driving or public transport to and from work.
Don't forget to offset this cost against anything you might save from driving or public transport to and from work.
Do people actually use this scheme and ride to work?
Yep. Both the bikes I've bought on the C2W scheme, I've used extensively for cycling to work and by that I mean, 15 miles each way, 5 days a week, right the way through the year, every year. It's a brilliant scheme.
Plus, 40% starts at only £32k. It's hardly Branson territory.
Plus, 40% starts at only £32k. It's hardly Branson territory.
First taxable £32k. You get £10k tax free, so you have to earn £42k to be taxed 40% on everything over that £42k.
Tomhoward is correct. Starts at £42k. People seem to forget first £10k tax free, then next £32k at 20%, then £40k to £150k at 40%. It's not all @40% if you earn over £42k. In fact earn £43k and you will only pay £1k at 40%.
Income tax and how it works really should be taught properly in schools. It amazes me how few folk (some I've explained it to earn 6 figures) know how it works. Anyway, apologies op for hijacking your thread, as you were.
More people would understand it if it was written as simple as tonyg puts it. The tax office website is typical none plain English plain English.
I know it's been done to death but it is the cycle to work scheme. If you're after a cheap Bike I'm sure there's plenty out there.
Look in the sales and 0% finance, you will probably get a cheaper per month deal, but then again using credit on STW is the Devils work, even if it saves you money.
so id being £50 a month worse off?
Yes, but you'll have bought a bike.
If you don't want to be "worse off" don't buy the bike.....
This is how life works. Earn money, live life, spend money. Your choice what to spend/ what to save. If you want to spend less per month buy less stuff per month. Your choice. Simples. 😉
I bought a bike on c2w last year. £1k bike, lower tax band, salary went down about £58 per month. Final payment was 7%. Total cost was roughly £800, so a 20% saving. The bike I bought has only been reduced 10% in the last two sale seasons, so I'm happy with that. Plus Evans were giving £100 of accessories as well with the scheme.
Nearly bought a Defy on the scheme once I'd paid for the CX. Glad I didn't as I've just got one in the sales 30% off.
I am down £53 per month for a £1k Brompton.
depends on how much your bike is...if the deductions (gross) are in the region of £63 then your net is likely to be closer to £38 once you account for tax
depends what they want you to do with the bike once the scheme finishes tho...residual value will be £250 and HMRC will want the tax on that (about £100)
Final payment of £75 to extend my "hire period" for four(?) years and that was it.
On HMRC's own scheme, so I'm assuming it's correct!
one thing I've never understood about C2W scheme is what happens if the bike is stolen?
Insurance will add to the monthly cost? - guess depends on where you live and if actually used for work the security there
one thing I've never understood about C2W scheme is what happens if the bike is stolen?
You continue the repayments and have no bike. Most schemes seem to mention that quite heavily - ie don't expect another bike to arrive. Though most people with £1k items tend to get it covered on their contents insurance.
You continue the repayments and have no bike
that was my recollection from looking at mrs antigee's work scheme a few years ago - I sort of hoped that the larger scheme providers had rolled insurance into the overall package - guess that makes too much sense
It's worth noting that Evans will do their sale prices on Cyclescheme. I got £120 off a 2014 bike in January, plus the scheme saving on top of that.
I sort of hoped that the larger scheme providers had rolled insurance into the overall package - guess that makes too much sense
Judging by how much time people spend reading things like policies and small print I'd assume the conversation would be along the lines of
"My Biked was nicked"
"Was it locked in the manner specified in the insurance docs we gave you"
"My Biked was nicked, what documents"
Here's a thought...get a cheaper bike and pay less per month?
Our scheme made it clear you had to insure their bike, same as with a car on HP.
You could always buy a bike that costs less than £1000.
I ride to work on a £400 Genesis Aether, as well as using it for sportives and other road rides. It's a really good bike and is very comfortable. Another £100 or less for mudguards, gatorskins and lights and you'll be sorted for going to work.
Here's the newer, replacement Volant model for £400:
http://www.winstanleysbikes.co.uk/product/59075/Genesis_Volant_00_2013_Bike_GN75150?gclid=CMLZuNbKrsACFfOhtAod3T4Adw
Maybe go for a bike around that level instead?
Iirc there was a friendly quotation page on the c2w site that predicted your payments when you filled in the bike value/ your salary etc. might be a good first start!
I got my genesis latitude 20 on c2w already discounted from £1600 to £1000 by winstanleys then used the scheme and ended up paying £55 a month for a year.
I've never heard anything else from them or paid anything else since. That was nearly 3 yrs ago.
Iirc there was a friendly quotation page on the c2w site that predicted your payments when you filled in the bike value/ your salary etc. might be a good first start!
2nd post has a link. 😀
£1000 bike to cycle to work... 😕 I use an old MTB with slicks made up from bits from parts bin. Costs are almost zero per month.
Parking in Leeds for a car £5 to £8 per day petrol about £50 per month . Factor in other savings such as no point in using a gym , occasional lump sum bonus for being victim of bad driver cycle to work leaves you quid's in .
My Planet X came in at £1000 plus an admin fee. The deduction from my salary was £83 per month (before taxes etc) since its finished I'm about £56 better off.
I had to pay an extended loan period (ie another 3 years) upon completion of £70, so in all I spent about £800 on the bike, spread over 14 months.
Its still a saving of £200, but tbh you'd probably find better deals on 0% finance and last years models.
You can get last years models on C2W scheme too with the discount or even ask for one from the shop, I did and got 10% plus then with the savings on the scheme I got a £1100 bike for around £700. Can't see how 0% deal beats that.
Those guys that used evans - do they still only do their own version of c2w? or do they accept other schemes (my work uses cyclescheme only)
I wouldn't cycle to work on a £1000 brand new bike, odds are it would get stolen. I commute on an 8 year old rusting Il Pompino, which cost £600 when I bought it......
I've had two bikes on the C2W scheme, both were the maximum £1000. It works out at £80 gross and £50 net deduction per month if you're one of the 90% of people who don't earn enough to be in the 40% tax band.
Like with all salary sacrifice schemes - nursery vouchers, pensions, etc. - if you're one of the richest 10% people in the 40% band, you save even more per month than people who are less well off.
And if you're not using the bike to ride to work for >50% of its annual miles, you're evading tax.
I wouldn't cycle to work on a £1000 brand new bike, odds are it would get stolen. I commute on an 8 year old rusting Il Pompino, which cost £600 when I bought it......
I would, and do.
" wouldn't cycle to work on a £1000 brand new bike, odds are it would get stolen. I commute on an 8 year old rusting Il Pompino, which cost £600 when I bought it......"
So your work gets alot of bikes stolen and hasnt done anything about it ?
Lifes too short to ride shit bikes.
I wouldn't cycle to work on a £1000 brand new bike, odds are it would get stolen.
Maybe at your work but at mine they'd have to break into the building without setting off the alarm that's linked to our control room. Plus it's very low crime around here so not likely to happen.
I once commuted on a £5k DH bike.
Once.
I wouldn't cycle to work on a £1000 brand new bike, odds are it would get stolen.
Like those above I also definitely would.
Iirc there was a friendly quotation page on the c2w site that predicted your payments when you filled in the bike value/ your salary etc. might be a good first start!2nd post has a link.
Moreover it has the answer too - net salary sacrifice on a £1000 voucher, on a 40% tax earner is £48.33/month.
Lifes too short to ride shit bikes.
I really like the Il Pompino! I also like the fact I don't worry about it being scratched / bashed in the very busy bike racks, rusting in the rain, locking it outside the pub / shops on the way home with a £1.99 lock (free with cycling weekly) etc.
In fact most of the Elite cyclists in Cambridge inc ex international pros, seem to ride very tatty town bikes to work etc...
Good for them, I still don't want to 😉
A town bikes not a commuting bike though.
Fine if your commutes short through town and slow in traffic etc how ever i have a decent length commute that i need something solid dependable reasonably quick comfy and most of all , something i want to ride for that distance.
In fact most of the Elite cyclists in Cambridge inc ex international pros, seem to ride very tatty town bikes to work etc...
Hahahaha! Funniest comment I've read in ages.
"Pro's and Elites do it so it must be a good idea"
My commute's only 4km each way. Over the years I've ridden an old MTB, a new MTB, a cx bike, a cargo bike, a custom-framed monstercross bike.
And if you're not using the bike to ride to work for >50% of its annual miles, you're evading tax.
IIRC the rule is "half of the rides".
Not that it matters in practice as it would be incredibly hard to prove when a bike had been used for a non-commuting ride.
Seems like too much hassle to me, done it once, currently ride an evolving beast (commute is bigger than when I did cycle to work) with broken bits being replaced with cheapish hopefully durable bits, and lots of money spent on dynamo lighting.
Isn't the number of people who are perceived by hmrc to be abusing the scheme the reason it costs more than it used to? It's why nice things don't last long.
IIRC the rule is "half of the rides".
It could be.
Not that it matters in practice as it would be incredibly hard to prove when a bike had been used for a non-commuting ride.
It's a difficult one, because you could buy a bike, ride it to work once and then stick it in the garage for a year unused and be within the rules.
But, there are a lot of people clearly taking the piss, and this could lead to the scheme being withdrawn.
Isn't the number of people who are perceived by hmrc to be abusing the scheme the reason it costs more than it used to? It's why nice things don't last long.
No.
But, there are a lot of people clearly taking the piss, and this could lead to the scheme being withdrawn.
That's been said since it started, still going.
That's been said since it started, still going.
For now.
I suspect it's still going, because 40% rate payers do well out of it while it's of no help to those who are genuinely badly off. (Other than helping the availability of second hand bikes.)
I doubt that the 10% are the ones that keep it going.
Was it ever about helping people who are "genuinely badly off"? I thought it was to incentivise and encourage cycling, and it's done, and continues to do, that.
I bought a full sus Kona on the scheme. Commuted on it for 2 weeks in the snow when my road bike would have killed me. Splendid scheme, shame my payments now go on nursery vouchers. 🙄
In fact most of the Elite cyclists in Cambridge inc ex international pros, seem to ride very tatty town bikes to work etc..
Drac,
Laugh all you want, but footflaps is bang on the money there. Cambridge is a nightmare for bikes being stolen, even really, REALLY shit ones. People at work have had 20 quid Halfords rejects stolen despite being locked up and my old bike got swiped from a locked bike shed.
I used to play "Spot the decent bike" when walking through town and realised the futility of it after a few months. With the exception of the occasional hipster riding a Kona fixie, it's just wall to wall junk.
Sorry if that makes me sound snobby. I'm not really, but the only time I have seen decent bikes out and about in Cambridge is when the London to Cambridge is on or, more recently, when Le Tour kicked off here.
Laugh all you want, but footflaps is bang on the money there.
If you look further up I said it may be the case for his area, the rest of the UK may differ so people can ride £1k bikes to work.
the rest of the UK may differ so people can ride £1k bikes to work.
Cambridge is a bit of a special case as far as cycling in the UK goes.
I ride an expensive bike to work, despite living in the 3rd poorest region in northern Europe.
I ride a nice road bike into work in central London, would I do so if I was locking it up outside? No bloody chance!
I suspect it's still going, because 40% rate payers do well out of it while it's of no help to those who are genuinely badly off. (Other than helping the availability of second hand bikes.)
A tax free bike on one-year interest-free finance is "no help whatsoever" for people who are badly off.
A tax free bike on one-year interest-free finance is "doing well out of it" for 40% tax payers.
A tax free bike on one-year interest-free finance is "no help whatsoever" for people who are badly off.A tax free bike on one-year interest-free finance is "doing well out of it" for 40% tax payers.
People who are badly off aren't eligible for the scheme. If your take home is below national minimum wage after the salary sacrifice you can't take advantage of the scheme.
That's terrible, does that apply to Childcare Vouchers etc as well or is it just C2W?
Why is stopping people going under minimum wage terrible?
If you will go below the minimum wage do you really need a 1k bike?
Martyn Lewis rules
1. Do I need it?
2. Will I use it?
3. Can I afford it?
No to any of the above don't bother.
Why is stopping people going under minimum wage terrible
It's that persons choice?
But people earning minimum wage, those who can least afford to buy any bike to cycle to work on, are excluded from the scheme because the salary sacrifice would take their wage below "minimum wage".
Take away the moral implications of minimum wage, it's utter shit and is degrading and immoral, the C2W scheme benefits those with higher incomes than those with lower. Someone who pays income tax at 40% is in a much better place financially to purchase a suitable bike to use for work. Some one on minimum wage is not. However much or little you spend.
If you will go below the minimum wage do you really need a 1k bike?
Cheaper bikes are available.
That is kind of how tax incentives work, if you don't pay a lot of tax - you are not going to be able save alot through tax incentives. However, the tax benefit of the cycle scheme is that providing a bicycle to an employee is not a taxable benefit. So an enlightened employer can provide bikes to employees to compute to work and they will not be taxed on them even if they are on the minimum wage. The difficulty is with the salary sacrifice which is wrapped into the whole package by the [u]commercial[/u] scheme providers so the company has no cost to providing the benefit. This makes it more attractive to employers but does not work for employees close to the minimum wage.
I agree Mefty.
Not to get too OT, but the "enlightened employer" paying minimum wage really couldn't care less about it's employees. If it did you would argue that it needs to pay more than minimum wage. If they are unable to then their business model is fundamentally flawed and they really shouldn't be in business.
As you were......
why is stopping people going under minimum wage terrible?
If they have earned their money like everybody else they should have the same access to tax free bikes.
Presumably there is legislation in place to ensure that people on minimum wage are guaranteed minimum wage as their take home, which is great. It's a pity it conflicts with C2W.
If they have earned their money like everybody else they should have the same access to tax free bikes.
As I said above, they do - it is the commercial schemes that cause the conflict not the legislation.
I'd ride my £1k bike as it will also be my one and only off road bike.