You don't need to be an 'investor' to invest in Singletrack: 6 days left: 95% of target - Find out more
Being an employer and self employed I can't take advantage of the scheme.
I employ 3 people on PAYE, for between 1 and 3 days a week. Two of them also receive a state pension.
As they all live locally I would like to set up the scheme and encourage them to cycle to work.
What happens if the pensionable ones just stop work?
What happens if our young 3 day a weeker decides she needs a full time job and leaves?
What happens if they decide they don't like cycling and flog or give their bikes to family members?
Who legally owns the bike until it's paid off?
Are there any negative points for the employer?
Stop thinking of it as a "Scheme". Its not. All it really is, is an allowance to salary deduct the cost of a bike from their salary.
They choose a bike, you buy it and deduct the total from their salary, spread out over 12 months. That's it. End of.
The reduction in the salary means you as an employer pay less NI.
After 12 months you charge them 5% and they keep the bike.
If they leave before you can charge them the outstanding amount, or keep the bike and sell it on ebay.
They just sign a letter to agree to the salary deductin. That's all you need to do. Oh, and the credit licence limit does not apply any more so long as you do it over 12 months. So you can spend more than a grand.
You as an employer are not required to do more, so you don't need to check to see if they ride it at all.
[i]Being an employer and self employed I can't take advantage of the scheme.[/i]
Let employer (you) the buy the bike(s) and employees (including you) use them?
Ok so you've no 'income' from them, but this way you get a 'tax-free' bike 🙂
So some employers just sign up to a scheme to manage this (like halfords etc). We used to run our own though, which I preferred. Basically you're getting ownership of the bike and then leasing it to the employee for a period of 12+ months at a set price per month. If the employee leaves you can give them the option of buying out the remainder of the bike from the company, or the company would retain ownership of the bike. That ownership is the main reason most of the schemes don't like people spending more than a grand as if a grand is on the scheme and 500 is a personal top-up then what happens if the employee leaves, who retains ownership ?
One thing though, the final payment is 'fair market value', which isn't always 5% - it depends on the initial value of the bike according to HMRC (but there's a few ways round that)
the main one being re hire it for 7% of the value [ 5% if under £500] for a further three years at which point its wortheless
you can actually buy a new bike after the 12 mth is up
Cutting through the crap I'd like a new bike and the accountant has advised us to spend more money this year.
I said can I have a bike he said no. We are a shop with no real need for one.
So looking for some route to getting me a bike through the books.
What sort of shop? What do you sell/do?
Gift shop. I could cycle half a mile to the post office once a month I suppose!
We can have new phones and computers even a van, all I want is a bike.
I'd even paint up in shop colours with our logo.
edit. One year I was able to claim for my spiked ice tyres as we couldn't drive to the shop . Maybe I need a bike to put them on.
I'm in the same situation to the OP and looked into this recently.
Can you legitimately claim that you commute to the office, even if not the majority of the time? That would include riding to the train station to take a train if the distance to the workplace is impractical.
I also understand that the company can purchase a bike for pooled staff use. This would meet your cycling to the post office every now and again situation. for the pooled bike, no salary sacrifice would be required and it is an asset that is shared by the staff.
I cycle to the shop every day, does that help? Any info I can give the accountant to further his knowledge would be good.
I like the idea of a staff bike.
Absolutely!
https://www.gov.uk/government/publications/cycle-to-work-scheme-implementation-guidance
All the info I got was in the gov.uk link.
New bike time 🙂
[i]Cutting through the crap I'd like a new bike and the accountant has advised us to spend more money this year.
I said can I have a bike he said no. We are a shop with no real need for one.[/i]
Change your Accountant. It's you that decides the business need and his job to put the numbers in the right columns.
Put it on the books as IT equipment if need be 🙂
I also understand that the company can purchase a bike for pooled staff use. This would meet your cycling to the post office every now and again situation. for the pooled bike, no salary sacrifice would be required and it is an asset that is shared by the staff.
that's what I'd do. No one says it has to make business sense.
What sort of gifts? Do people order locally and you drop them off? Could you use it for local pick ups?
The post office drop off is a good idea
Surly Big Dummy would be awesomes!
Does me riding it to the shop every day make it justifiable expenditure or does there need a business angle to it?
I thought the benefit from the scheme was dependent on your marginal tax rate?
So if your employees are semi retired and only working a couple of days the tax saving through the scheme could be minimal. They'd be better off just buying a reasonable commuter off Decathlon for £250.
If you're on higher tax rate, the saving is 40% so a lot more worthwhile.
I thought there needs to be a business reason for it, rather than just getting to work
It has to do at least 50% of it's usage for commuting or work use. How they can prove this i've no idea. In the case of a pooled bike, time will be saved by your staff using it to get to and from the post office quicker therefore your staff will spend more time in the shop selling...there's your business case.
As there is no upper spend limit, I'm planning on getting a Carbon full bouncer that I will also use to commute on, occasionally, I'll also need the required safety equipment and clothing!
Even if it looks suspicious, HMRC would need to prove otherwise.
Even if you're a 20% tax payer you save 20% tax then 11% national insurance contributions and then it's also VAT deducatable as far as I can tell.
I honestly will commute on it!
[img] 
[/img]