Cylce Scheme – “A Fair Market Value payment is payable upon cessation”
The final payment has nothing to do with cyclescheme. The employer own the bike, not cyclescheme. The employee pays the employer for the bike.
5% of original price is usual, or I’ve seen one extra monthly payment used as well. It’s a token amount to stop the scheme being a hire purchase scheme.Posted 8 years ago
Just considering running the Cyclescheme at my business. Has anyone experience of “A Fair Market Value payment is payable upon cessation of the agreement or at the end of the lease period” ? E.g. what sort of prices are cyclescheme asking for ?
Am I right in thinking cyclescheme works as follows,
1, Get quote for bike,
2, Company pays Cyclescheme for bike
3, Cyclescheme pay shop for bike
4, Employee pays monthly (deduct from salary) for bike
5, End of term cyclescheme ask for a fee from employee to buy bike…
cheers.Posted 8 years agogreyspokeMember
My employer insists that the final payment is at true market value, because if it was lower that (ie the difference between the nominal 5% say and the actual market value) would count as a taxable benefit which they would have to deal with. But they do say you can carry on using the thing for as long as you like even though it is still their property.Posted 8 years agopjt201Member
My work didn’t charge me anything, and i don’t work there anymore but still have the bike. I wouldn’t worry about the taxable benefit aspect as i think there’s a tacit understanding at HMRC that cyclescheme can have low final purchase values, obviously they can’t change the rules for one thing, but they can chose not to scrutinise it.Posted 8 years agoTinManMember
My work (NHS) is doing the 11mthly repayments with a 1mth+£5 charge in the 12th month as fair market value.
Considering the volume of employers who do not consider ‘actual’ market value at the end of the year, I would image they actually got tax office advice over what is reasonable to avoid the ‘taxable benefit’ issue.Posted 8 years agoMilitant_bikerMember
3, Cyclescheme pay shop for bike
should be ‘3, Cyclescheme pay shop for bike taking a 10% commission right out of shop’s margin’ 🙂
And somewhere in there should be ‘Cyclescheme sit on paperwork for weeks whilst employee has no bike’ I’d suggest shopping around for other providers of Bike to Work schemes (do a google for Bike to Work – several big shops offer it direct), you may find others run a lot better schemes than Cyclescheme.Posted 8 years ago
Cyclescheme sit on paperwork for weeks whilst employee has no bike
All the vouchers at our place have come through really quickly, and all three bike shops I’ve heard of were amazed at how fast they came through. I’d suggest it’s the employers’ finance departments sitting on paying Cyclescheme’s invoice, not cyclescheme sitting on the paperwork.Posted 8 years agoHoratioHufnagelMember
Cycle to work scheme assumes you’re using it every day to and from work throughout the year. If you hit a few pot holes and use the brakes a lot, it’ll need new wheels. The gears will probably be worn out. if its got suspension front and/or rear that could need a full service etc etc. If you price this up at proper bike shop rates, its very easy to argue that 5% IS fair market value for a well used bike.
My current commuter i bought as an old MTB. i’ve had to replace both wheels, tyres, shifters, mechs, cassette chain ring and chains, handlebars (they were very old) grips and saddle.Posted 8 years agoMrOvershootSubscriber
Very true Horatio.
My CX bike on the CycleScheme is on its 3rd set of tyres, 2nd chain & cassette, 2nd saddle & 2nd lot of bar tape all provided by me. Oh and I’ve changed 1 set of brake pads and fitted a set of XTR rotors. And I only got it at the end of Febuary.
Mind you it did get a lot of use over the last 2 weeks on holiday in France! Is that against the C2W scheme?Posted 8 years agobuzz-lightyearMember
“fair market value”
Well I am keeping all the original parts that are wearing out. If it comes to valuation, I’m going to put them all back on. I’ve got an old Judy fork that can go on (“the Fox one wore out – honest”)
But it won’t come to that. I think it will be £50. Flog it and then think about getting another bike on the scheme!Posted 8 years ago
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