C2W - Fair market value my ar*e.

dhope

The scoundrels charged me £5 to transfer the £1000 Boardman into my name after a year!

phillipjohnson

I thought it had changed now so the fair market value had to be something like 20% of the original cost of the bike or something like that to avoid ridiculously low values at the end.

I thought if the value was less than this you had to justify it... Bike damaged etc.

Is this not the case?

tailwindhome

Shush

The tax man will hear you.

alfablue

phillipjohnson wrote:

I thought it had changed now so the fair market value had to be something like 20% of the original cost of the bike or something like that to avoid ridiculously low values at the end.

I thought if the value was less than this you had to justify it... Bike damaged etc.

Is this not the case?

Yes, HMRTC assume FMV at 1 year for a £1k bike is 25%. Your employer can give you the bike for £0 if they wish, you just pay tax at your rate on £250, which would be £50, £100 or £125 depending on what rate you're on, deducted through paye over the following year.

See http://www.hmrc.gov.uk/manuals/eimanual/eim21667a.htm

You can also argue the fmv is less than their estimate.

dhope

alfablue wrote:

phillipjohnson wrote:

I thought it had changed now so the fair market value had to be something like 20% of the original cost of the bike or something like that to avoid ridiculously low values at the end.

I thought if the value was less than this you had to justify it... Bike damaged etc.

Is this not the case?

Yes, HMRTC assume FMV at 1 year for a £1k bike is 25%. Your employer can give you the bike for £0 if they wish, you just pay tax at your rate on £250, which would be £50, £100 or £125 depending on what rate you're on, deducted through paye over the following year.

See http://www.hmrc.gov.uk/manuals/eimanual/eim21667a.htm

You can also argue the fmv is less than their estimate.

Not sure of the specifics but I'd assume HR have done their homework ('tis a bank)

The Rookie

Bank - done their homework - first time for everything I guess!

Worst case you get taxed on it, which is still less than you 'should' have paid!

Simon

Blandiblub

I got a letter from my employer about the new rules - I'll just pay the tax on the 25% value, so about £40 ish (on a £550 bike and lower-rate tax payer).

Headhuunter

dhope wrote:

The scoundrels charged me £5 to transfer the £1000 Boardman into my name after a year!

Clearly they left a zero off when working out the final amount! lucky you!

cloggsy

Spawny git!

flicksta

I have an even more spawny trump card.

My scheme (second time round for me), just ended. No FMV payment at all, no letter, nothing. First time I got the letter and had to pay the old FMV. This time nada.

Get in!