I’ve used two scheme providers in the past and I pay 40% tax.
You need to be careful to ensure that your costing includes:
– Payments, less tax (this bit looks attractive)
– Hidden “cost of finance” charges; typically 10-15%
– 7% end of term fee / 3-year “hire” (3% below £500), as dictated by HMRC
– any charge by the bike provider; e.g. Planet X charge 10%
The savings are substantially eaten away by the above. I was considering going for a £1k voucher through Cyclescheme recently and calculated that the overall cost was going to be c.£850 for the bike I wanted.
“tomketon” will find that the 39% saving won’t be that and that he’ll need to pay £70 at the end of the first year, or return the bike.
So, the main attraction IMO is the convenience of a salary deduction. It’s an easy way not to pay £1k upfront and make the cost more bearable.
I’d consider using a £1k voucher and putting more money in to buying a more expensive bike… except that I rarely buy complete bikes.