Cycle to Work Sceme Cheats

Wallace1492

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

flicksta

I expect unlikely in the Commuting forum.

mybreakfastconsisted

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

I did. I use my Galaxy for commuting now, but for the first two years I used my Trek for commuting and the CTW Dawes for touring. I didn't want to leave an expensive bike at work or outside pubs, I preferred front suspension on the canal tow paths and I figured the aim of the scheme was to get people cycling, which I was.

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

hfidgen

I expect unlikely in the Commuting forum.

To be fair...

PresumingEd

Me. I bought a MTB on C2W last year that will almost definitely never be ridden to work.

I don't see any problem with doing this, particularly as I do ride to work 2-3 times a week and bought myself a road bike for that purpose shortly before my employers introduced the C2W scheme, having been categorically assured that they would not be doing so at any point!

hmbadger

flicksta wrote:

I expect unlikely in the Commuting forum.

You're joking aren;t you? Lots here with more than one bike.....

kelsen

I know somebody who bought a triathlon bike for their partner via the scheme. Totally wrong in my opinion. He should've used the voucher to get an n+1 bike for himself.

Butterd2

Of course! I use my 18 year old commuter for cycling to work. The £1700 Scott on CTW is for weekends only (allegedly).
But then I pay more tax in a week then I save in total through CTW so my conscience is clear.

robz400

:oops:

To be fair it just doesn't seem logical to commute on my brand new Fondriest R10 (collecting it tonight) when then Carrera does such a sterling job.

Come summer, then no doubt it'll used for a Friday commute and extended ride home - Does that count?

Mark Elvin

Hey, I've been looking at a £1000 bike on the C2W sheme with no intention of using it for work, however my comopany are not going to run the sheme any more.

However, I pay 2X more in tax in one month than the voucher value, so my conscience is also clear.

W1

mybreakfastconsisted wrote:

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

There are those on here who would suggest that acting outside the spirit of the scheme means it is in fact tax evasion.....

Personally I think the more cyclists out there, the better.

shm_uk

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

Loads of my colleagues have taken advantage of the scheme but never used the bike to get to work. Whether they ever intended to, only they truly know.

There's nothing in the scheme that mandates what you use the bike for, but it is abusing the spirit of the scheme if you're just using it to save a few quid. Bit of a cynical approach to the scheme, but what do you expect?

Having said that, some of my colleagues would likely not have purchased a bike at all until Cycle to Work arrived, so there's more people cycling somewhere or other if not to work.

CiB

Surely the point of the scheme is to get people cycling, and to encourage cycling to work. [My emphasis].

I've always thought it a tacit acceptance on the part of HMRC that there's no compulsion to use it for work based on the wording in all the blurb and the fact that there are absolutley no guidelines anywhere about policing it, or keeping records of commutes. If only there was an easy-to-use web page somewhere that commuters could record their commuting mileages nay stats on. Oh if only...

Go back to the original concept. The govt wants to get more people out on bikes; as any fule know it ticks all the boxes - healthy, green, cuts down pollution etc etc. And then imagine the focus groups opposing a scheme that subsidised cycles for the middle classes [(c) Mirror, Sun et al], so the govt ties it in with worthy aspirations, the most obvious one being 'you can have a subsidised bike, but you ought to make an effort to use it for more than just going to the pub or popping round for a bit of ows-yer-father when her old man's doing nights. But we won't make any great effort to enforce it as that's unworkable in reality. We'd have to register each bike, then we'd be expected to insist on insurance & licencing schemes etc. And to cover our backs on forcing people to ride to work we'd have to mandate helmet wearing. What are we, the bleeding Nazi Party?'

And so on.

shm_uk

shm_uk wrote:

There's nothing in the scheme that mandates what you use the bike for

Correction: Yes there is:

dft.gov.uk wrote:

The exemption removes the tax charge that would otherwise apply to cycles and cyclists' safety equipment loaned to employees provided the following conditions are met

- Ownership of the equipment is not transferred to the employee during the loan period;

- Employees use the equipment mainly for qualifying journeys; i.e. for journeys made between the employee’s home and workplace, or part of those journeys (for example, to the station), or for journeys between one workplace and another.

The tax exemption only applies when an employee mainly uses the cycle and cyclists' safety equipment for qualifying journeys. A qualifying journey for an employee means a journey, or part of a journey,
- between his or her home and workplace, or
- between one workplace and another,
in connection with the performance of their duties of employment.

So, for example, cycling to and from the station to get to work would qualify. In this case, 'mainly' means that more than 50% of use of the cycle and safety equipment must involve a qualifying journey.

Employees are not expected to keep mileage logs but employers should make clear to them that if they do not use the cycle mainly for qualifying journeys, they may lose the benefit of the tax exemption. In that event the employer would have to report the benefit in kind on form P11D, and account for Class 1A NICs, in the normal way. The employee would be liable for the tax due on the benefit in kind.

But do you really expect people to be honest?

And how many employers are going to bother monitoring how their staff get to work?

rjsterry

CiB wrote:

Surely the point of the scheme is to get people cycling, and to encourage cycling to work. [My emphasis].

I've always thought it a tacit acceptance on the part of HMRC that there's no compulsion to use it for work based on the wording in all the blurb and the fact that there are absolutley no guidelines anywhere about policing it, or keeping records of commutes. If only there was an easy-to-use web page somewhere that commuters could record their commuting mileages nay stats on. Oh if only...

Go back to the original concept. The govt wants to get more people out on bikes; as any fule know it ticks all the boxes - healthy, green, cuts down pollution etc etc. And then imagine the focus groups opposing a scheme that subsidised cycles for the middle classes [(c) Mirror, Sun et al], so the govt ties it in with worthy aspirations, the most obvious one being 'you can have a subsidised bike, but you ought to make an effort to use it for more than just going to the pub or popping round for a bit of ows-yer-father when her old man's doing nights. But we won't make any great effort to enforce it as that's unworkable in reality. We'd have to register each bike, then we'd be expected to inists on insurance & licencing schemes etc. And to cover our backs on forcing people to ride to work we'd have to mandate helmet wearing. What are we, the bleeding Nazi Party?'

And so on.

A nice precis of your posts on the last week's threads.

CiB

rjsterry wrote:

A nice precis of your posts on the last week's threads.

Aye thenk yew. I'm here all week.

Etc.

Blue Meanie

Not having a brand new bike doesn't stop you cycling to work, where's the numbers that show that CtW has soley been responsible for increased bicycle usage?
I've seen lots of titanium and carbon fibre bought via CtW, also full-sus downhill-rigs, which appalls me.

So far I've been the recipient of 1x pair of longs and 1x softshell, which I wear while Cycling to Work.

My Idea: Work to Pub Scheme! Salary sacrifice to earn beer tokens redeemable at your local nominated outlet.

mudcow007

i bought my "stinky" on the scheme, but there is no way on earth i was/ am;

1. riding a £1500 full suspension bike around liverpool (tried it a few times and got chased by scallywags)

2. riding said bike on the road with 7" travel front and back it would be like being on a boat

as others have said i think any reason to get people off their arses and onto bikes is a good thing. and before i get shouted at i was already cycling to work, my stinky is just another transportation choice

dilemna

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

+1. It's tax fraud. If the bicycle is not used for at least 50% of qualifying journeys it is deemed by the Revenue as a Benefit in Kind (BIK). It's not just cheating the Revenue but all the rest of us who pay tax who are subsidising your new toy. I had to buy my bike as my employer refused to take part in the C2W scheme. And I DO ride it to work which is the thing that really farks me off as other people who have bought bike(s) on the C2W scheme leave their fragile catwalk race bikes or full sus race downhill bikes at home and still drive!!! The system is clearly being abused by cheating employers as well employees. I think the NI contributions are reduced as well as the cost of the bike comes off gross salary BEFORE tax and NI afaib. People who have bought a bike or bike(s) on the C2W scheme and do not ride them to work are just as bent as benefit cheats.

dft.gov.uk wrote:
The exemption removes the tax charge that would otherwise apply to cycles and cyclists' safety equipment loaned to employees provided the following conditions are met

- Ownership of the equipment is not transferred to the employee during the loan period;

- Employees use the equipment mainly for qualifying journeys; i.e. for journeys made between the employee’s home and workplace, or part of those journeys (for example, to the station), or for journeys between one workplace and another.

The tax exemption only applies when an employee mainly uses the cycle and cyclists' safety equipment for qualifying journeys. A qualifying journey for an employee means a journey, or part of a journey,
- between his or her home and workplace, or
- between one workplace and another,
in connection with the performance of their duties of employment.

So, for example, cycling to and from the station to get to work would qualify. In this case, 'mainly' means that more than 50% of use of the cycle and safety equipment must involve a qualifying journey.

Employees are not expected to keep mileage logs but employers should make clear to them (employees) that if they do not use the cycle mainly for qualifying journeys, they may lose the benefit of the tax exemption. In that event the employer would have to report the benefit in kind on form P11D, and account for Class 1A NICs, in the normal way. The employee would be liable for the tax due on the benefit in kind.

sketchley

The rules are clear 50% of the use of the bike must be riding to work. It does not say 50% of you journeys by any bike must be riding to work. Buying a bike on C2W then riding another non C2W scheme bike to work would not mean you could not ride the C2W bike at weekends.

I seem to remember the employer guidelines from HMRC stating that providing it is clear that the employee is cylcing to work there will be no need to check usage. Likewise if you are cyling to local station how are they going to check. That being said I just because you can get away with it doesn't make it legal.

Buying a bike through C2W when you intend that the majority of it's use would not be for commuting, and then not declaring it as tax benefit, would be tax evasion which is illegal and would make you worse than a large coroporation engaging in Tax Avoidence which is of course perfectly legally. :twisted:

notsoblue

dilemna wrote:

I had to buy my bike as my employer refused to take part in the C2W scheme.

Ahh, I think I understand now.

dilemna

notsoblue wrote:

dilemna wrote:

I had to buy my bike as my employer refused to take part in the C2W scheme.

Ahh, I think I understand now.

Some one else who understands what is going on.

vorsprung

dilemna wrote:

It's not just cheating the Revenue but all the rest of us who pay tax who are subsidising your new toy. I had to buy my bike as my employer refused to take part

Do I smell the delicious aroma of sour grapes?

shm_uk

Q: What's the difference between fraudulently claiming benefits and buying a bike on the C2W scheme but never using it to commute?

A: Nothing


Fraud is fraud is fraud
There's no "if's" or "but's"


Just because nobody's enforcing the C2W rules evertybody thinks "wa-hey, cheap stuff" without ever thinking they're extorting the Govt out of tax revenue.

mybreakfastconsisted

shm_uk wrote:

Q: What's the difference between fraudulently claiming benefits and buying a bike on the C2W scheme but never using it to commute?

A: Nothing


Fraud is fraud is fraud
There's no "if's" or "but's"


Just because nobody's enforcing the C2W rules evertybody thinks "wa-hey, cheap stuff" without ever thinking they're extorting the Govt out of tax revenue.

Tish and piffle.

Buying a bike with tax incentives is nothing like extortion or benefit fraud, it's taking advantage of tax concessions just as deducting 10% wear and tear from the tax due on rental income from a house you let. If I paid full whack on a bike I bought the government would only do something silly with the extra money. Like a war.

W1

mybreakfastconsisted wrote:

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

I did. I use my Galaxy for commuting now, but for the first two years I used my Trek for commuting and the CTW Dawes for touring. I didn't want to leave an expensive bike at work or outside pubs, I preferred front suspension on the canal tow paths and I figured the aim of the scheme was to get people cycling, which I was.

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

You do seem to like to pick and choose what laws you want enforcing....

Lovely word that, "really".

sketchley

mybreakfastconsisted wrote:

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

I did. I use my Galaxy for commuting now, but for the first two years I used my Trek for commuting and the CTW Dawes for touring. I didn't want to leave an expensive bike at work or outside pubs, I preferred front suspension on the canal tow paths and I figured the aim of the scheme was to get people cycling, which I was.

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

No, it's evasion. Tax is due as you are receiving a tax excemption without meeting the rules for that excemption therefor you are legally required to declare it and pay the tax, failure to do so is evasion not avoidence.

http://en.wikipedia.org/wiki/Tax_avoida ... ax_evasion

mybreakfastconsisted

W1 wrote:

mybreakfastconsisted wrote:

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

I did. I use my Galaxy for commuting now, but for the first two years I used my Trek for commuting and the CTW Dawes for touring. I didn't want to leave an expensive bike at work or outside pubs, I preferred front suspension on the canal tow paths and I figured the aim of the scheme was to get people cycling, which I was.

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

You do seem to like to pick and choose what laws you want enforcing....

Lovely word that, "really".

What law do you reckon I've broken?

It's not measured by mileage you strange stalky nutjob, I could use the CTW bike to cycle to Greece and back and then commute on it once and abide entirely by the guidelines.

notsoblue

W1 wrote:

mybreakfastconsisted wrote:

Impossible to police, I don't think I did anything wrong, it's not really tax evasion, just avoidance like using your ISA allowance.

You do seem to like to pick and choose what laws you want enforcing....

Lovely word that, "really".

Are you somehow using the fact that MBC uses C2W in a way that is technically breaking the rules, to somehow invalidate his opinion on the way corporations avoid tax through exploiting loopholes?

Good god man.

Headhuunter

dilemna wrote:

Wallace1492 wrote:

Anyone here know anyone that has a bike through the scheme with absolutely no intention of cyling to work? Just doing it to save the tax.....

I really do not agree with this.

+1. It's tax fraud. If the bicycle is not used for at least 50% of qualifying journeys it is deemed by the Revenue as a Benefit in Kind (BIK). It's not just cheating the Revenue but all the rest of us who pay tax who are subsidising your new toy. I had to buy my bike as my employer refused to take part in the C2W scheme. And I DO ride it to work which is the thing that really farks me off as other people who have bought bike(s) on the C2W scheme leave their fragile catwalk race bikes or full sus race downhill bikes at home and still drive!!! The system is clearly being abused by cheating employers as well employees. I think the NI contributions are reduced as well as the cost of the bike comes off gross salary BEFORE tax and NI afaib. People who have bought a bike or bike(s) on the C2W scheme and do not ride them to work are just as bent as benefit cheats.

dft.gov.uk wrote:
The exemption removes the tax charge that would otherwise apply to cycles and cyclists' safety equipment loaned to employees provided the following conditions are met

- Ownership of the equipment is not transferred to the employee during the loan period;

- Employees use the equipment mainly for qualifying journeys; i.e. for journeys made between the employee’s home and workplace, or part of those journeys (for example, to the station), or for journeys between one workplace and another.

The tax exemption only applies when an employee mainly uses the cycle and cyclists' safety equipment for qualifying journeys. A qualifying journey for an employee means a journey, or part of a journey,
- between his or her home and workplace, or
- between one workplace and another,
in connection with the performance of their duties of employment.

So, for example, cycling to and from the station to get to work would qualify. In this case, 'mainly' means that more than 50% of use of the cycle and safety equipment must involve a qualifying journey.

Employees are not expected to keep mileage logs but employers should make clear to them (employees) that if they do not use the cycle mainly for qualifying journeys, they may lose the benefit of the tax exemption. In that event the employer would have to report the benefit in kind on form P11D, and account for Class 1A NICs, in the normal way. The employee would be liable for the tax due on the benefit in kind.

I know plenty of people who have bought bikes and barely ever ride to work, there are a few where I work. However I'm sure more than 50% of their journeys are to work because they simply don't use the bike any other time anyway. People often have great intentions to ride to work and buy a bike on the scheme but then get lazy or the weather's rainy or they get a puncture and never get round to fixing it etc etc.

I don't see how they would ever stand a chance in hell of actually enforcing the 50% rule and to me it seems utterly pointless to write it in. It may not be in the spirit of the scheme but as far as I'm concerned there are far wose tax dodges out there - businesses avoiding millions in corporation tax, wealthy individuals with offshore payment schemes avoiding personal tax even the car scrappage scheme which in my view was insane. As far as I'm concerned purchase of bikes, tax free, for whatever purpose which even slightly gets people out of cars and onto bikes, get my thumbs up...

HMRC should focus its attention on the macro view rather than the cycle to work scheme.

sketchley

mybreakfastconsisted wrote:

What law do you reckon I've broken?

It's not measured by mileage you strange stalky nutjob, I could use the CTW bike to cycle to Greece and back and then commute on it once and abide entirely by the guidelines.

Good point, it does only say 50% of the use. Doesn't specficy how you measure this. Could be number of days riden, millage, hours riden, etc.

Fact is though getting a bike through CTW that you do not intend to use for cycling to work and then not declaring the benefit on your tax form is tax evasion and you are therefor breaking the law.