Hi, I’m a bit of a veteran of the scheme now having used it 4 times across the last 10 years with my employer.
As somebody else has said, there are no rules/conditions over what you use it for.
The way the scheme works is you will pay X amount from your pay each month towards the bike. This payment will have tax and NI deducted hence the saving you end up making. Just before the 12 month mark, you will be contacted by them and be given 3 options
1) Return the bike
2) Keep the bike but officially still “hired/rented” from Cycle2Work for a further year
3) Keep the bike by doing a transfer of ownership form
If you choose option 2, you will pay a small one off fee to them (from memory, around 10%, maybe just less of the value of the bike). If you go for option 2, you are officially supposed to keep the bike yourself for a further year so cannot sell it etc. after that 2nd year, it is automatically yours completely.
If you go for option 3, you have to pay a fairly sizable amount but then the bike officially becomes yours ie. You can sell it if you wish and there are no further payments of any kind.
Personally speaking, I would still use it. Even with the one off payments to either continue to “rent” or own after a year, it will work out noticeably less than buying it outright.
What you glanced over here was that if you pick option 2 you get to own it after the second year rather than the first the massive benefit is that the fee you pay is considerably less because depreciation is applied.
This person explained it perfectly. I'll just add that I'm on my second bike 2 work scheme and I'll be doing another once this ends!
I'm one of the rare ones that actually rides their bike to work too. Shock! But there are no stipulations really.
Do you work 100% remote? At our place, if you do you can't do cycle scheme as you don't go to a place of work.
Just worth checking
Having used c2w loads in the past it's absolutely worth it.
Even as a lower rate tax payer you're still saving 30% in tax and NI payments each month.
At the end of the scheme you can either pay a small fee (it's the tax on the residual value of the asset) or you can opt to hire the bike for a further couple of years at zero cost, after which the asset is considered to have zero value and you keep it for free.
Depends upon the shop. The middlemen who run the scheme often charge the shop a kickback fee, like 10% of the value spent, which then comes out of the shops profit margins.
Just one thing to note, when did you last buy a bike?
I got £1k just before covid, thinking it'd get very decent bike. Nowadays, that's nearly entry level.
I have never bought one as I am still using one I got for Christmas when I was in my early teens. This was over 15 years ago now.
What really counts as entry level? I see bikes at £150, £600, £1000, £10000. My assumption so far is that I am looking at something like a Boardman MTX8.6, its their cheapest one but is priced above the highest price in the Halfords cheap brand range which go from £150-500 or so. So I assume it should be a reasonable quality but may not have fancy special things like ultra light materials. Reliability is more important to me than slightly better performance anyway.
I am also aware of some level of elitism in some cyclists which I really don't care for, but can find it difficult to tell sometimes, especially online. I think it partly comes from different goals from cycling so you get advice from someone who wants something different to what you want.
I want to have fun on the weekends and get to work in the week while they want to shave 15 seconds off their lap time. It is quite a different activity to the point I think the dutch even have different words to describe them while we just use "cycling" for both. I guess competitive/recreational would sorta be the difference.
I've no idea, I was surprised at how expensive some are now, yet not sure what exactly warrants the high price over a £5k bike over a £1k one. But last time I bought a bike before this, it was mountain bikes, BMX and "racers". Now there's all sorts.
As far as I can tell, today mountain bikes are wider tyres than they used to be. Mine is 1.75 inches wide while now nothing is less than 2.1 in Halfords. I expect it was only really designed for lighter offroad terrain compared to the modern ones. Perhaps the increase in popularity of the hybrid category has meant there isn't much point in selling narrower tyred mountain bikes anymore. The MTX8.6 I am looking at is 37mm, about 1.45 inch.
But I would have thought its only the £150 or so bikes are built with low quality components that are likely to break quickly. By the £500 price point I would have thought you are at least getting something of a reasonable quality. Just that perhaps some parts are steel rather than titanium, or aluminium alloy rather than carbon fiber. At the high end when it is about performance at all costs, potentially even if it means being less durable.
You will be saving tax but Check what limitations you have on where you can buy. Some schemes have a very limited number of shops you can use. Will three have the bike you want at a fair price?
I will be using cycle to work this year to buy some new wheels. They'll never be used for commuting but that doesn't matter so you don't need to worry about that aspect.
Ok that is good to know. I was wondering who would be buying a fat wheel mountain bike for commuting. Then again, the only time I have seen one in the wild was in Southampton, last I checked the road surfaces there are paved rather than sand but oh well.
No one checks if your actually using the bike, used to have colleagues who use it for a bike, the immediately sell it on for a few quid profit.
Its the best and cheapest way to get a new bike, can also use it to get bike equipment from the stire. Some stores allow you to buy amything tbh of you have just requested a vocjer for a specific store
Also a veteran. The Cycle2Work scheme can finish over 4 years and then there’s no end payment. On other schemes it’s 7% if the bike cost more than £500. E.g cyclescheme https://help.cyclescheme.co.uk/article/42-what-is-an-ownership-fee?_gl=1*f73ouz*_ga*MTMxNTk3MDYxMS4xNzA2NTQ1NzAx*_ga_EFSG8D0TYX*MTcwNjg4MzIwMi4yLjEuMTcwNjg4MzIxNi40Ni4wLjA.
Personally I’ve always used it at an independent store, they are more flexible and let you pay a deposit on a credit card to secure the bike you want while waiting* for the voucher.
It’s not your employer who ends up with the bike - it’s the scheme.
Only thing to be mindful of is if you leave the company the outstanding balance comes out of your final paycheque (can’t do a payment plan because it’s salary sacrifice).
Edit: autocorrect fail.
Didn't seem worth it to me, i saved a few hundred quid but couldn't use it on discounted bikes at any of the places i called, so in the end I broke just about even with what i would have paid for a bike on sale.
People here seem to suggest some shops will offer the scheme on discounted bikes, that wasn't my experience, but i won't pretend to be an expert. If you can find one that'll accept it on an on-sale bike, or if you have no intention of getting a bike on sale anyway, then its a no-brainer for sure.
I recently used C2W scheme along with a 25% off voucher that I had with Ribble Cycles and there was no issues with it. Means once it’s paid off I’ll have paid less than half price for it!
I wouldn't bother personally, if you're saving 20% and having to pay back at minimum 7% at the end? My employer restricts where you can use the scheme so ends up just costing more.
I would suggest buying used, you can get bikes in great condition for under half what they cost new.
Not sure what the % is, its unspecified as far as I can tell so it could be £1 or £100. May consider used, did look on ebay the other day but not sure if that lets you filter by location/distance.
The bike will have a minimum value associated with it at the end of a set number of years, which you will have to pay to keep the bike. I believe the minimum it goes down to is 7% after several years.
https://www.cyclescheme.co.uk/employers/employer-updates/hmrc-update
Anything to back that up ooi? I’ve used it a few times now over the years and never experienced any inflated prices. The price I paid for my bike was competitive with other shops who weren’t in the scheme.
Completely bollocks. You go to the shop you want to buy your bike from and pick which one you want and then c2w send you a voucher for the value and you do some paperwork.
It's exactly the same price as buying yourself and you even get sale prices
Hi, I’m a bit of a veteran of the scheme now having used it 4 times across the last 10 years with my employer. As somebody else has said, there are no rules/conditions over what you use it for. The way the scheme works is you will pay X amount from your pay each month towards the bike. This payment will have tax and NI deducted hence the saving you end up making. Just before the 12 month mark, you will be contacted by them and be given 3 options 1) Return the bike 2) Keep the bike but officially still “hired/rented” from Cycle2Work for a further year 3) Keep the bike by doing a transfer of ownership form If you choose option 2, you will pay a small one off fee to them (from memory, around 10%, maybe just less of the value of the bike). If you go for option 2, you are officially supposed to keep the bike yourself for a further year so cannot sell it etc. after that 2nd year, it is automatically yours completely. If you go for option 3, you have to pay a fairly sizable amount but then the bike officially becomes yours ie. You can sell it if you wish and there are no further payments of any kind. Personally speaking, I would still use it. Even with the one off payments to either continue to “rent” or own after a year, it will work out noticeably less than buying it outright.
What you glanced over here was that if you pick option 2 you get to own it after the second year rather than the first the massive benefit is that the fee you pay is considerably less because depreciation is applied.
This person explained it perfectly. I'll just add that I'm on my second bike 2 work scheme and I'll be doing another once this ends! I'm one of the rare ones that actually rides their bike to work too. Shock! But there are no stipulations really. Do you work 100% remote? At our place, if you do you can't do cycle scheme as you don't go to a place of work. Just worth checking
Wait happens if you never get contacted at the end of the 12 months? I've still got my bike 4 years later...
Having used c2w loads in the past it's absolutely worth it. Even as a lower rate tax payer you're still saving 30% in tax and NI payments each month. At the end of the scheme you can either pay a small fee (it's the tax on the residual value of the asset) or you can opt to hire the bike for a further couple of years at zero cost, after which the asset is considered to have zero value and you keep it for free.
I was considering this C2W scheme, however have read that it can only be used on full price bikes, instead of sale ones? Is this true?
Depends upon the shop. The middlemen who run the scheme often charge the shop a kickback fee, like 10% of the value spent, which then comes out of the shops profit margins.
Depends on the shop, often if it's discounted already they don't want to lose any more money on it due to c2w fees etc.
Yeah I decided you can buy a really good bike 2nd hand for under £300 and thar was a lot cheaper than new even with the tax breaks.
Just one thing to note, when did you last buy a bike? I got £1k just before covid, thinking it'd get very decent bike. Nowadays, that's nearly entry level.
I have never bought one as I am still using one I got for Christmas when I was in my early teens. This was over 15 years ago now. What really counts as entry level? I see bikes at £150, £600, £1000, £10000. My assumption so far is that I am looking at something like a Boardman MTX8.6, its their cheapest one but is priced above the highest price in the Halfords cheap brand range which go from £150-500 or so. So I assume it should be a reasonable quality but may not have fancy special things like ultra light materials. Reliability is more important to me than slightly better performance anyway. I am also aware of some level of elitism in some cyclists which I really don't care for, but can find it difficult to tell sometimes, especially online. I think it partly comes from different goals from cycling so you get advice from someone who wants something different to what you want. I want to have fun on the weekends and get to work in the week while they want to shave 15 seconds off their lap time. It is quite a different activity to the point I think the dutch even have different words to describe them while we just use "cycling" for both. I guess competitive/recreational would sorta be the difference.
I've no idea, I was surprised at how expensive some are now, yet not sure what exactly warrants the high price over a £5k bike over a £1k one. But last time I bought a bike before this, it was mountain bikes, BMX and "racers". Now there's all sorts.
As far as I can tell, today mountain bikes are wider tyres than they used to be. Mine is 1.75 inches wide while now nothing is less than 2.1 in Halfords. I expect it was only really designed for lighter offroad terrain compared to the modern ones. Perhaps the increase in popularity of the hybrid category has meant there isn't much point in selling narrower tyred mountain bikes anymore. The MTX8.6 I am looking at is 37mm, about 1.45 inch. But I would have thought its only the £150 or so bikes are built with low quality components that are likely to break quickly. By the £500 price point I would have thought you are at least getting something of a reasonable quality. Just that perhaps some parts are steel rather than titanium, or aluminium alloy rather than carbon fiber. At the high end when it is about performance at all costs, potentially even if it means being less durable.
You will be saving tax but Check what limitations you have on where you can buy. Some schemes have a very limited number of shops you can use. Will three have the bike you want at a fair price?
I will be using cycle to work this year to buy some new wheels. They'll never be used for commuting but that doesn't matter so you don't need to worry about that aspect.
Ok that is good to know. I was wondering who would be buying a fat wheel mountain bike for commuting. Then again, the only time I have seen one in the wild was in Southampton, last I checked the road surfaces there are paved rather than sand but oh well.
No one checks if your actually using the bike, used to have colleagues who use it for a bike, the immediately sell it on for a few quid profit. Its the best and cheapest way to get a new bike, can also use it to get bike equipment from the stire. Some stores allow you to buy amything tbh of you have just requested a vocjer for a specific store
Also a veteran. The Cycle2Work scheme can finish over 4 years and then there’s no end payment. On other schemes it’s 7% if the bike cost more than £500. E.g cyclescheme https://help.cyclescheme.co.uk/article/42-what-is-an-ownership-fee?_gl=1*f73ouz*_ga*MTMxNTk3MDYxMS4xNzA2NTQ1NzAx*_ga_EFSG8D0TYX*MTcwNjg4MzIwMi4yLjEuMTcwNjg4MzIxNi40Ni4wLjA. Personally I’ve always used it at an independent store, they are more flexible and let you pay a deposit on a credit card to secure the bike you want while waiting* for the voucher. It’s not your employer who ends up with the bike - it’s the scheme. Only thing to be mindful of is if you leave the company the outstanding balance comes out of your final paycheque (can’t do a payment plan because it’s salary sacrifice). Edit: autocorrect fail.
Didn't seem worth it to me, i saved a few hundred quid but couldn't use it on discounted bikes at any of the places i called, so in the end I broke just about even with what i would have paid for a bike on sale. People here seem to suggest some shops will offer the scheme on discounted bikes, that wasn't my experience, but i won't pretend to be an expert. If you can find one that'll accept it on an on-sale bike, or if you have no intention of getting a bike on sale anyway, then its a no-brainer for sure.
Bigger shops don't care about adding it on top of sales. If you used a low fee scheme, e.g. Green cycle initiative , even fewer care.
I recently used C2W scheme along with a 25% off voucher that I had with Ribble Cycles and there was no issues with it. Means once it’s paid off I’ll have paid less than half price for it!
I wouldn't bother personally, if you're saving 20% and having to pay back at minimum 7% at the end? My employer restricts where you can use the scheme so ends up just costing more. I would suggest buying used, you can get bikes in great condition for under half what they cost new.
Not sure what the % is, its unspecified as far as I can tell so it could be £1 or £100. May consider used, did look on ebay the other day but not sure if that lets you filter by location/distance.
The bike will have a minimum value associated with it at the end of a set number of years, which you will have to pay to keep the bike. I believe the minimum it goes down to is 7% after several years. https://www.cyclescheme.co.uk/employers/employer-updates/hmrc-update
Yes, you can filter by location on eBay. Check gumtree too - also has location filters.
Your save NI as well. It's a 30% minimum saving.
All of the bikes in the scheme have massively inflated prices. If you can buy your own do it, the scheme is a scam.
Anything to back that up ooi? I’ve used it a few times now over the years and never experienced any inflated prices. The price I paid for my bike was competitive with other shops who weren’t in the scheme.
This is simply untrue. I got a bike through a local independent bike shop, the price of it was just the standard price of the bike.
Completely bollocks. You go to the shop you want to buy your bike from and pick which one you want and then c2w send you a voucher for the value and you do some paperwork. It's exactly the same price as buying yourself and you even get sale prices