- Cycle to Work Scheme – end of loan period
So, regarding the above, has anyone got to the end of their loan period, and if so, what did they end up paying? (This threw me as I thought your payments covered the whole cost of the bike, not that you pay for so long, then buy the bike after a set time, which your employers – or a finance company if they’ve used one – own)
The FAQs on the C2WS site says:
What happens at the end of the loan period?
Most employers opt to sell you the bike and accessories, and you will pay the fair market value; this is the amount that a buyer would pay to a seller to purchase the bike and equipment. Each bike is assessed separately, but in our experience the market shows values to be around 5% of the original voucher value plus VAT. The fair market value cannot be stated before or during the scheme as this could be considered a benefit in kind as hire-purchase does not warrant any tax-relief.
So has anyone got to this point, and if so, did they pay around 5% of the voucher cost, or more, or less?
Cheers all.Posted 9 years ago2tyredMember
Ours was 10% – i thought that was a bit high and had pushed for 5, but the accountants advising my employer were concerned that would make it a bit too much like an untaxed benefit apparently.
We got a 10% discount off RRP though, so I guess it more or less worked out.
The 10% came off gross salary, same as the installments.Posted 9 years agojonathanSubscriber
Mine was supposed to be 5% and I was asked whether I wanted to buy it or not for that. I said yes and heard no more about it, assuming they’d take it out of salary, but I’m actually sure they did as there was no deduction from January’s salary and my last normal payment was, I think, December.
It would have been less than 40 quid though (they had a £750 limit) so I might not have noticed 😉Posted 9 years agoDelSubscriber
from what i have read elsewhere – customary for it to be a ‘nominal’ figure – ie whatever the accountant will swallow. this is on the basis that they could sell it at ‘market value’ to anyone in the street, but in order to do so ( and avoid liability ), they would have to have the thing serviced and given a clean bill of health. as it is your responsibility to keep it maintained during your stewardship, if you buy it and it falls apart a week later, that’s your fault, but if they wanted to pass it on to someone else, they can’t take your word for it that it has been maintained properly.
in your case that’s a very sensible approach…
did you buy it then?Posted 9 years agojohnikgriffSubscriber
Mine (Wife scheme) was up last week. They gave it to us for free, just had to sign a leter for transfer of ownership. The scheme did say it was going to make a charge at the end, but guess it was to much hassle. Starts again in July, already starting to pick something new out. Its a shame it only upto £1000.Posted 9 years agoBurchy1Member
as others have stated a ‘nominal’ fee is the norm, i’m gonna wait for the first people to use the scheme to get round to 12 months to make sure their definition of nominal matches mine.
Dougie – i’m a little scared now, thats gonna cause a fair bit of damage in Verbier!Posted 9 years agomtbtomoMember
I was told you don’t have to buy the bike at the end of the loan period. If you’re still at the company and still using it for biking to work as I’m sure you all are 😉 then you don’t need to buy it off the company, just keep using it.
Then after 6 months or a year later on from the end of the loan its worth even less and it might just be a case of signing for ownership.Posted 9 years ago
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