Has anyone who has participated in this scheme actually had to prove they are using the bike for commuting?

Not at my company, which is one of the largest and best for cyclists. I have, however, riden my very nice carbon bling wagon to work during the summer to go on club rides and racing after work. My first bike never went to work as I used to drive.

Nope. Nor any one else I know (but only about 3 people).

But I do use it.

No. I’m led to believe there is no onus on you to prove that you’re purchasing it to commute, but there is a hopeful expectation that that is the case.

I done it and never had to prove that i had used it for work, which was good as I never dud

I nearly used C2W scheme, and my employer (council) basically said they don’t mind too much, as whatever/wherever you ride there are still health benefits to be had and they don’t mind subsidising that through the scheme. Official line was a strong suggestion of using it for commuting, but they also said they’d never check.

the whole point of the C2W scheme was to get people fitter so the government doesn’t really care…. however, the tax man hates this scheme and has introduced hurdle after hurdle to try to stop it, even though the government want it.

I introduced it to our London office a few years ago and in trying to find out what you could and couldn’t do and why the scheme is structured the way it is, I have read through various minutes of meetings between the government’s legal teams and the tax men and they have used every trick in the book to try to undermine it.

The taxman claimed it was effectively a loan from the company and therefore each company would have to have a credit licence before they introduced the scheme, so the government set up a central credit licence for anyone using the scheme (that licence is for a maximum of £1,000 and that’s why that is the limit of the scheme).

the taxman then said that anyone under the age of 18 was too young to have a loan so couldn’t make use of the scheme (not sure if the government got around that one)

the taxman claimed it was discriminatory against physically disabled people as they couldn’t ride bikes and therefore it was illegal under the discrimination act. The lawyers told them that anyone could apply regardless of disability.

I was gobsmacked at some of the convoluted arguments the taxman raised to try to bring down this government initiative because the bikes are effectively subsidised from taxes.

I just wish they would put as much effort into sorting out google et al.

Anyway, unless its changed, the rules that the taxman finally squeezed in, in the hope of stopping this scheme, are:

1) the bike has to be used more for commuting than for pleasure, so 51% or more for commuting.
2) at the end of the repayment period the bike still belongs to the company not you (because you are hiring it not buying it)
3) if the company gives the bike to you then you have to pay full market price for the second hand bike (they originally had a fixed scale which was defeated by the government – or it may have been the law courts?)
4) you cannot have more than one bike on the scheme, so if you have finished your repayments and you are still using the “company’s” bike then you have to return this before you can get your next bike (unless you buy it for a fair market price).

can’t think of the others, but the fact is that everyone ignores these rules and has done since it was set up, mainly because the amount of tax involved per case is not enough for the taxman to chase on an individual basis.

So I would say, do as you please but make sure your company has all the right paperwork, including the salary sacrifice letters on file just in case, but after that, just do as you please, the taxman may want the cash, but there is no political will to get them to chase it up.

3) if the company gives the bike to you then you have to pay full market price for the second hand bike (they originally had a fixed scale which was defeated by the government – or it may have been the law courts?)

The Value table is still on the HMRC website and you’re only liable to the tax on the “benefit in kind”. So if the table values the bike at £120 you’re only liable to the tax on that amount (£48 in my case).

As for the using the bike for work thing, part of our paperwork was a declaration that “at least 50% of the bikes use would be work related”.

No. In fact I’ve used the cycle scheme bike (Cyclocross) to commute about 10 times in the 10 months I’ve had it – mostly use my road bike cos its quicker.
Cyclocross bike does get used more for other riding though.

It’s funny – our finance woman phoned me before I got the bike and said ” The tax people will check the bike shed”! Yeah, of course they will. And I don’t keep it in the bike shed…