So what exactly does the budget give us bike wise?

Cabaal

I've heard it off and on that there's a bit of a tax break in the budget for people wanting to get bikes to cycle to work or something along those lines.

So what exactly did change in the budget?

Morgan

Specifially, this:

7.—(1) Chapter 3 of Part 5 of the Principal Act is amended—
(a) in section 118 by inserting the following after subsection
(5F):
20 ‘‘(5G)(a) Subject to paragraph (c) of this subsection, subsection
(1) shall not apply to expense of up to
\1,000 incurred by the body corporate in, or
in connection with, the provision for a director
or employee of a bicycle or bicycle safety
25 equipment, where—
(i) the bicycle and bicycle safety equipment
provided is unused and not second-hand,
(ii) the director or employee uses the bicycle
or bicycle safety equipment, or the bicycle
30 and the bicycle safety equipment, as the
case may be, mainly for qualifying journeys,
and
(iii) bicycles or bicycle safety equipment, or
bicycles and bicycle safety equipment, as
35 the case may be, are made available
generally to directors and employees of
the body corporate.
(b) In this subsection—
‘bicycle’ means a pedal cycle;
40 ‘bicycle safety equipment’ includes—
(i) bicycle bells and bulb horns,
(ii) bicycle helmets that conform to European
product safety standard CEN/EN 1078,
35
Benefit-in-kind
charge: relief for
bicycles.
36
(iii) bicycle lights, including dynamo packs,
(iv) bicycle reflectors and reflective clothing;
and
(v) such other safety equipment as the
Revenue Commissioners may allow; 5
‘normal place of work’ means the place where
the director or employee normally performs the
duties of his or her office or employment;
‘pedal cycle’ has the same meaning as it has in
section 3(1) of the Road Traffic Act 1961, and 10
does not include an electrically assisted pedal
cycle;
‘qualifying journey’, in relation to a director or
employee, means the whole or part of a
journey— 15
(i) between the director’s or employee’s
home and normal place of work, or
(ii) between the director’s or employee’s normal
place of work and another place of
work, where the director or employee is 20
travelling in the performance of the
duties of his or her office or employment.
(c) A director or employee shall not, by virtue of
this subsection, be relieved from a charge to
income tax under subsection (1) more than 25
once in any period of 5 consecutive years of
assessment, commencing with the year of
assessment in which the director or employee
concerned is first provided with a bicycle or
bicycle safety equipment.’’, 30
(b) in section 118B—
(i) in subsection (1) in the definition of ‘‘salary sacrifice
agreement’’ by substituting ‘‘ ‘salary sacrifice
arrangement’ ’’ for ‘‘salary sacrifice agreement’’,
(ii) in subsection (2)— 35
(I) in paragraph (a)(i) by deleting ‘‘and’’ and in
paragraph (a)(ii) by substituting ‘‘section
510(4), and’’ for ‘‘section 510(4),’’, and
(II) by inserting the following after paragraph (a)(ii):
‘‘(iii) a bicycle or bicycle safety equipment pro- 40
vided to a director or employee and
which is exempt from a charge to tax by
virtue of section 118(5G),’’,
and
(iii) in subsection (5) by substituting ‘‘salary sacrifice 45
arrangement’’ for ‘‘salary sacrifice agreement’’.
(2) This section applies in respect of expense incurred on or after
1 January 2009.

Morgan

Basically, you can get up to €1000 of bike/accessories through your employer, either as a completely free benefit-in-kind (if your employer likes you); or paid for by deductions from your salary, saving you 41% (if that's your tax rate).

Itsfixed

ARticle from this week's Irish Independent

passive

I'm not paid enough to be taxed =(.

Vélo

passive wrote: »

I'm not paid enough to be taxed =(.

You'll still get the 20% discount

Chips Lovell

Aquinas73 wrote: »

You'll still get the 20% discount

If they're outside the tax net, how'll they get 20 per cent off?

Vélo

I thought anyone who doesn't earn enough to pay tax is still in the 20% bracket, they just don't pay because they haven't used their tax credits. I also thought you get your employer to buy the bike and you pay them back less the 20% or 41% but I could be wrong and I may stand corrected.

Chips Lovell

Aquinas73 wrote: »

I thought anyone who doesn't earn enough to pay tax is still in the 20% bracket, they just don't pay because they haven't used their tax credits. I also thought you get your employer to buy the bike and you pay them back less the 20% or 41% but I could be wrong and I may stand corrected.

Yes, but if you're not paying any tax, you're not saving anything. Their discount would be 20% of zero.

Has any group come out with a handy pack that can be given to employers to highlight the positives of this scheme? My company has just turned it down so I'm trying to get something good to reply with.

Vélo

el tonto wrote: »

Yes, but if you're not paying any tax, you're not saving anything. Their discount would be 20% of zero.

Fair enough, I thought your employer bought the bike and you paid them back minus the 20% or 41%, It's a pity it's not more of an incentive to everyone, it really favours people on the higher wage but I suppose it's a start anyway.

Cabaal

thanks lads for the info, story on the independent helped explain it abit also, lets see what answer I get from work when I query it

smithslist

Myth wrote: »

Has any group come out with a handy pack that can be given to employers to highlight the positives of this scheme? My company has just turned it down so I'm trying to get something good to reply with.

No not yet, do you know how I could get my hands on the handy pack?

Cabaal

Companys have yet to be sent out the budget pack that goes over this, least thats what I've been advised

smithslist

Cabaal wrote: »

Companys have yet to be sent out the budget pack that goes over this, least thats what I've been advised

is there a way of downloading the pack from the web?

Chips Lovell

Myth wrote: »

My company has just turned it down so I'm trying to get something good to reply with.

Did they give you any reasons?

Aquinas73 wrote: »

It's a pity it's not more of an incentive to everyone, it really favours people on the higher wage but I suppose it's a start anyway.

In fairness, there are very few people outside the tax net. I guess it does favour people on the higher rate though, who can potentially double their savings.

hunnymonster

Has anyone got their employer to sign up to this yet. I want to get a bike reasonably soon but I've not had any response to my enquiries yet.

Chips Lovell

hunnymonster wrote: »

Has anyone got their employer to sign up to this yet. I want to get a bike reasonably soon but I've not had any response to my enquiries yet.

It doesn't kick in until January 1, so you might have to wait a bit.

el tonto

el tonto wrote: »

Did they give you any reasons?



In fairness, there are very few people outside the tax net. I guess it does favour people on the higher rate though, who can potentially double their savings.

'This is a finance decision.'

christeb

Myth wrote: »

'This is a finance decision.'

'You won't lose anything - so gimme my bike'!

Seriously, can they actually refuse??

Chips Lovell

Myth wrote: »

'This is a finance decision.'

Well, that's about as clear as mud. The costs involved are fairly minimal to a firm. Yes they have to pay for the bike upfront, but you repay them for that. You could argue that if you had the full cost deducted from your next pay cheque, then they'd hardly be impacted at all. For example, they pay €500 for the bike on the 25th, you get paid on the 28th and they get their €500 back. There's a bit of admin work involved too I guess, but it can hardly amount to much.

I'm guessing that some companies just won't be bothered at all. They'll see it as extra hassle to even find out about how it works.

christeb wrote: »

Seriously, can they actually refuse??

Yes, it's purely voluntary.

christeb

Well if your company is being an ass and doesn't want to help out their employees, then that just sucks. Also, if they only give employees the BIK advantage, will the employer not be making cash on the VAT returns?

Either way, I'm glad I work for a more pleasant employer and can look forward to a shiny new fixie / racer (decisions..) next year

Chips Lovell

christeb wrote: »

Also, if they only give employees the BIK advantage, will the employer not be making cash on the VAT returns?

I asked the Department of Finance about this. They said employers can't claim VAT back on bikes purchased under the scheme.

Turbulent Bill

The scheme reduces the employer's PRSI, which should reduce or eliminate any administration costs.

CSS seem to be fairly pro-active in promoting the scheme, could be a good place to start if you want to convince employers:

http://www.cyclesuperstore.ie/shop/pc/viewContent.asp?idpage=131

hunnymonster

Our guys haven't said no yet but " [FONT=&quot]There is of now no concrete information as to how this will work in practice." so it looks like it's going to be a while. I really need to get a new commuting bike in the next 2-3 months so it looks like I'll miss out :-([/FONT]

mmclo

Halfords seem to be offering standard factory bikes at half price which is effectively the same deal, presume they are clearing stock for an expected demand in new year.

May be worth checking if the employer offers the equivalent public transport scheme for commuter tickets. It would be hard to offer one and not the other surely

mmclo

mmclo wrote: »

May be worth checking if the employer offers the equivalent public transport scheme for commuter tickets. It would be hard to offer one and not the other surely

You'd think that wouldn't you! And stop calling me shirley.

Gavin

Chucked a simple outline onto the wiki from comments on this, for future requests

http://wiki.boards.ie/wiki/BikeToWork

blorg

I strongly suspect my employer is going to take exactly the same line as Myth's, just won't want the hassle. It will be more about the extra administration involved and the layers of bureaucracy than the money.