Self-administered Cycle to Work Scheme

Pessable

I've successfully persuaded my employer to introduce the Cycle to Work Scheme, and they are keen to administer the scheme themselves rather than working through one of the commercial administration agencies (e.g. cyclescheme.co.uk, bike2workscheme, Evans ride2work, Halfords, etc.). I'm also happy that they want to self-administer the scheme because when I asked in a bike shop about a particular bike in a shop that the £500 sale price (£600 otherwise) was unavailable with cyclescheme.co.uk!

Those agencies that offer their admin services for "free" to employers must be charging the bike shops a very significant commission. That probably means that bike prices generally have been artificially inflated by the C2W scheme! Which is particularly bad news if you buy a bike outside the scheme. Anyone buying a bike from cyclescheme.co.uk participating shop should negotiate a decent discount if they're not using the scheme.

Has anyone else any experience of a company that self-administers the C2W scheme? Any hints and tips that I can give my (very helpful and flexible) employer? Are there any employee agreements templates around that my employer could use?

Cheers,

Pessable.

Headhuunter

I wanted my company to do that but they basically said it's Cyclescheme or nothing. I read up all about administering it yourself and it didn't seemed very hard to do from what I remember, however it was a while ago now. As you say, the various middle men like Evans, Halfords, C2W etc charge a fair whack to the retailer which is why many retailers refuse to give sale prices for these customers

beancounter

I administer our company's cycle to work scheme (as I'm in charge of both finance and HR).

We have 10 guys on the scheme (out of total staff of 45). We let staff purchase any bike they want from any retailer they want - even on-line - as long as they can supply a proper VAT invoice to the company (not the individual) otherwise we can't reclaim the VAT.

Everyone gets the best deal they possibly can.

We have two agreements everyone has to sign, the Cycle Scheme Agreement and the Cycle Scheme Payment Agreement (which covers the salary sacrifice).

If you want to drop me an e-mail address I'll let you have blank copies of our agreements.

bc

Pessable

@Headhunter

I find it hard to understand why more companies don't self-administer too. There's no reporting to be done to HMRC and the rules are quite simple as long as your objective isn't to take the mick. I also think that just like "free" credit, there should be rules against them artificially fixing the price.

@beancounter

Thanks for the offer of the contracts - I have PM'd you with my email address. We're a similarsize company so I hope we can get similar takeup - it will make for better bike chat over lunch! Cheers.

Pessable.

pdw

I've recently set up our company scheme. If you looking to maximise the savings, it's worth bearing in mind that there's nothing to stop the company passing on the savings it makes on employer's NI. In fact, if your company is particularly cycle-friendly, there's nothing that requires them to cover their costs at all.

PM if you want a copy of the spreadsheet / contracts that I use.

schlafsack

Planet-X used to have some template contracts on the website, we used those to set up our self-administered scheme. It's really not that hard at all.

mutantllama

I am in the market for a Specialized Tricross Sport at the moment, and asked work about the C2W scheme but they advised that they would not offer the service (for whatever reasons, gits....), we get 10% discount from local bike suppliers (who do not do Specialized, and 10% is way less than the C2W scheme)

I may have the wrong end of the stick, but is this post suggesting that it may be possible to bypass my Employer and have someone else carry out the administritive work? Sorry if this is a dumb question, by it really irks me that my employer won't offer financial benefits that the C2W scheme offers....

The Rookie

mutantllama wrote:

10% is way less than the C2W scheme)

Saving on most C2W is between 15 and 20% so 10% is not really 'way less', some can be as low as 8% saving

(Tax/Ni saving is about 33% for base rate payers or 41% for higher rate payers, less 25% FMV)

Simon

pdw

Saving on most C2W is between 15 and 20% so 10% is not really 'way less', some can be as low as 8% saving

No, you can do much better than that, and I think most do. Assuming a VAT registered company, the hire portion is ex-VAT, which is of course now 20%, and paying 25% at the end is avoidable, either by delaying, or by selling at less than FMV and just paying the tax on it, or both.

Our company scheme offers around 42% saving on basic rate and over 50% for higher rate. And being self-adminstered, you can have that on top of whatever deal you can negotiate from the bike shop of your choice.

To answer the previous question, no, you can't bypass your employer. They're then ones who have to loan or hire you a bike. Third parties like Cyclescheme try to reduce the burden for employers, but they take their cut, which ultimately limits the savings.

mutantllama

Thanks, i'l take a look at Cyclescheme, but I think I am doomed to pay full retail...

benpinnick

Beginner, Savings on C2W are at worst 15% from the VAT element alone, before any tax deduction from salary sacrifice kicks in, assuming both LBS and employer are VAT registered - how did you get to your figure of 15 < 20%?

Fezzer42

Could someone tell me how self administered schemes work with bikes over £1000 or is this not a factor in this case?

Work have agreed to the cycle to work scheme and I think that self administered is the way to go but the bike I would be looking at is about £1300. I've read that if the bike is over £1000 then the company needs to get a Consumer Credit Licence. But I have heard that if you self administer I can top up the excess over the £1000 limit.

If its ok with beancounter and pwd I'll pm you for those documents you've offered!

creamtea

BC, I hope you are well, I am new to this blog, know it is old - I run my own company and have been told I can self administer the Cycle Scheme which I am keen to do so - given you have to now pay 7% to extend or 25% to but end of yr 1 - you mention you are kind enough to email out the blank docs - could you please to john@polaris-search.com

many thanks
John

beancounter wrote:

I administer our company's cycle to work scheme (as I'm in charge of both finance and HR).

We have 10 guys on the scheme (out of total staff of 45). We let staff purchase any bike they want from any retailer they want - even on-line - as long as they can supply a proper VAT invoice to the company (not the individual) otherwise we can't reclaim the VAT.

Everyone gets the best deal they possibly can.

We have two agreements everyone has to sign, the Cycle Scheme Agreement and the Cycle Scheme Payment Agreement (which covers the salary sacrifice).

If you want to drop me an e-mail address I'll let you have blank copies of our agreements.

bc

fionnacaddick

beancounter said:

I administer our company's cycle to work scheme (as I'm in charge of both finance and HR).


We have 10 guys on the scheme (out of total staff of 45). We let staff purchase any bike they want from any retailer they want - even on-line - as long as they can supply a proper VAT invoice to the company (not the individual) otherwise we can't reclaim the VAT.


Everyone gets the best deal they possibly can.


We have two agreements everyone has to sign, the Cycle Scheme Agreement and the Cycle Scheme Payment Agreement (which covers the salary sacrifice).


If you want to drop me an e-mail address I'll let you have blank copies of our agreements.


bc

fionnacaddick

Hi @beancounter
Would you still be kind enough to forward blank copies of your cycle scheme agreement and cycle scheme payment agreement please?