CycleToWork early termination

joecamel

Hi there
Has anyone any experience of terminating their CycleToWork contract early? Through redundancy perhaps or just moving on to another job? Any knowledge of the different options and how they work out in the real world would be much appreciated. Thanks.

bompington

There is no different option. You just have to pay up what's left - without the tax break.

thistle_

I was made redundant after making my last monthly payment but before the FMV payment.

I pestered HR and payroll about it before I left but nothing happened and nobody asked me for the final payment for the bike back. That was 5 years ago now...

joecamel

bompington wrote:

There is no different option. You just have to pay up what's left - without the tax break.

I heard you can just hand the bike back. Anyone know if that's true? Not that you'd want too but...

joecamel

thistle (MBNW) wrote:

I was made redundant after making my last monthly payment but before the FMV payment.

I pestered HR and payroll about it before I left but nothing happened and nobody asked me for the final payment for the bike back. That was 5 years ago now...

I do know that it belongs to the company until the final payment / balloon-fee then it's owned by Cycletowork, who lease it back to you for 7% of the original cost. Then after 3 years it's yours.
Perhaps yours just went into limbo as the company had got their money back and no one could be bothered with the admin after that?

awavey

joecamel wrote:

bompington wrote:

There is no different option. You just have to pay up what's left - without the tax break.

I heard you can just hand the bike back. Anyone know if that's true? Not that you'd want too but...

my understanding was you had to pay the remainder of the 1 year agreement however much was left, because thats principally what you signed up to regardless of your employment status, but they become NET payments without the tax benefit.

and then once thats paid, you cpuld then choose to hand the bike back and end the deal in a "normal way"

thistle_

joecamel wrote:

I do know that it belongs to the company until the final payment / balloon-fee then it's owned by Cycletowork, who lease it back to you for 7% of the original cost. Then after 3 years it's yours.

My C2W was done through Cyclescheme, not Cycletowork and our hire period was 18 months. We only paid for the first 12, then after the 18th month you were supposed to pay the final payment (Which was generally £20 or something silly as it was before the HMRC guidance was issued on what a £1000 bike is really worth after 1 year).

There was no option to extend the lease for an additional amount, although I believe this was brought in as an option after I had left as a way to avoid paying high/realistic final amounts for the bike.

Lee540

I ended my Cyclescheme early because I left my company and went elsewhere.

I was 8 months through 18 months..

I had to pay the additional 10 months with no tax benefit as one lump sum, then, because of the way the scheme works, I had to pay another very small amount to lease the bike further period of time.. then the bike fully became mine.

shimanobottombracket

This cycle to work scheme sounds a load of tosh. Sounds like you could end up paying more for a bike, rather than less. Even if there was a financial benefit, I think I would much rather buy a bike myself strait off (which I have done actually).

MrGrumpy

bought 4 bikes now on Cycle 2 work/ cycleplus over the last 7/8 yrs and not one of them has cost me more than the rrp, saved a bomb, in real terms the £56 a month a pay before tax is £36 approx in real terms every month. Higher rate tax payers save even more

slowbike

MrGrumpy wrote:

bought 4 bikes now on Cycle 2 work/ cycleplus over the last 7/8 yrs and not one of them has cost me more than the rrp, saved a bomb, in real terms the £56 a month a pay before tax is £36 approx in real terms every month. Higher rate tax payers save even more

If you want the latest bike and can't wait until it's on sale - then yes - you'll "save" money ...
otherwise, most of the time you can get an equivalent bike for about what you're paying out each month ...

it's just a way of financing the bike - works for some, not for others - personally it wouldn't work for me, I want my bike to be mine - not belonging to the company or however else the scheme operates and I'm quite happy to buy last years model at a significant discount off RRP ...

shimanobottombracket

Slowbike wrote:

MrGrumpy wrote:

bought 4 bikes now on Cycle 2 work/ cycleplus over the last 7/8 yrs and not one of them has cost me more than the rrp, saved a bomb, in real terms the £56 a month a pay before tax is £36 approx in real terms every month. Higher rate tax payers save even more

If you want the latest bike and can't wait until it's on sale - then yes - you'll "save" money ...
otherwise, most of the time you can get an equivalent bike for about what you're paying out each month ...

it's just a way of financing the bike - works for some, not for others - personally it wouldn't work for me, I want my bike to be mine - not belonging to the company or however else the scheme operates and I'm quite happy to buy last years model at a significant discount off RRP ...

I agree, C2W is censored !

kajjal

You just have to be careful as sale bikes on interest free credit can be similar value for money and completely independent of any employment changes. This is what i did in the end.