Bike to work scheme questions.

noeleoreid

On a tax rate of 20%, will i only save 20% or possibly more.. Is universal social charge also deducted and what about prsi as well or is it just the tax u pay??

Do I have to go through my employer? Heard someone say that I can just fill out a tax return form and do it that way. Dunno will the boss man go for it considering it will be just one person doin the scheme....

If not, .. Does ur boss have too physically come down to the bike shop and purchase it for you?? Or can u make the purchase and present him with the receipt?? Might be a silly question... but it does say that on the wiki boards 'bike to work' page.

What is the minimum period of time that u can repay the purchase through your deductions? in my case paid weekly... Dont want to have to have deductions from my pay for a long period of time, would prefer if i could just pay it all in one big deduction on the first month for instances..

Khannie

noeleoreid wrote: »

On a tax rate of 20%, will i only save 20% or possibly more.. Is universal social charge also deducted and what about prsi as well or is it just the tax u pay??

It's before prsi for sure. Not sure about the USC.

noeleoreid wrote: »

Do I have to go through my employer? Heard someone say that I can just fill out a tax return form and do it that way. Dunno will the boss man go for it considering it will be just one person doin the scheme....

Pretty sure your company has to do the actual purchase, though I am open to correction there.

noeleoreid wrote: »

If not, .. Does ur boss have too physically come down to the bike shop and purchase it for you?? Or can u make the purchase and present him with the receipt?? Might be a silly question... but it does say that on the wiki boards 'bike to work' page.

Again, pretty sure you can't just present them with the receipt but open to correction. They don't have to go down to the bike shop to purchase it for you, but they might have to write the cheque for example. In my case it was done by bank transfer.

noeleoreid wrote: »

What is the minimum period of time that u can repay the purchase through your deductions? in my case paid weekly... Dont want to have to have deductions from my pay for a long period of time, would prefer if i could just pay it all in one big deduction on the first month for instances..

You can pay it off straight away if that suits you and your employer better. That decision is between you and the employer.

GT_TDI_150

noeleoreid wrote: »

On a tax rate of 20%, will i only save 20% or possibly more.. Is universal social charge also deducted and what about prsi as well or is it just the tax u pay??

Do I have to go through my employer? Heard someone say that I can just fill out a tax return form and do it that way. Dunno will the boss man go for it considering it will be just one person doin the scheme....

If not, .. Does ur boss have too physically come down to the bike shop and purchase it for you?? Or can u make the purchase and present him with the receipt?? Might be a silly question... but it does say that on the wiki boards 'bike to work' page.

What is the minimum period of time that u can repay the purchase through your deductions? in my case paid weekly... Dont want to have to have deductions from my pay for a long period of time, would prefer if i could just pay it all in one big deduction on the first month for instances..

if you are on the 20% rate you will save 32%, it does include the USC

Beasty

The company must make the initial purchase. You cannot simply present a receipt

More info in the wiki

noeleoreid

GT_TDI_150 wrote: »

if you are on the 20% rate you will save 32%, it does include the USC

How does it come up to 32% ? Is USC 12%??

RacoonQueen

Beasty wrote: »

The company must make the initial purchase. You cannot simply present a receipt

More info in the wiki

I made the initial purchase with mine. Brought the receipt into work afterwards, they then transferred the same fee to the bike shop and the shop refunded me. This was all done 18 months ago though, it may have changed...

Beasty

RacoonQueen wrote: »

I made the initial purchase with mine. Brought the receipt into work afterwards, they then transferred the same fee to the bike shop and the shop refunded me. This was all done 18 months ago though, it may have changed...

The law on this has never changed since the scheme was introduced.

Now if you had simply paid a refundable deposit, and not taken possession of the bike until the company had paid the purchase price to the shop, everything would have been legal (although pretty pointless). If not, ......;)

noeleoreid

over what time period de ye all repay it? Id really be lookin to repay it quickly.. no intrest in this salary sacarfice malarky..

Khannie

I'm paying mine over 12 months. Delighted with that to be honest. I don't really see the downside. Also, with inflation I'm saving at least a score.

noeleoreid

my other concern is im due to change jobs in a short few months time, what happens wen i change then if im in the middle of paying installments through salary sacrifice to my current employer.. will my new employer take up the scheme with me.... can i transfer over??

spurscormac

noeleoreid wrote: »

my other concern is im due to change jobs in a short few months time, what happens wen i change then if im in the middle of paying installments through salary sacrifice to my current employer.. will my new employer take up the scheme with me.... can i transfer over??

When I did it last year, the company arranged payments over 4 months. I think it depends on each company how they setup the system internally.
I believe should you move jobs, the balance due will come out of your final payslip.
I do think that it may be possible to buy another bike on the scheme with your new employer, but I would be open to correction on that.
I think its based on one bike per employee per 5 years, but that as its the company claiming off the government, you may be able to do it as many times as you move job.

Beasty

There is a difference of opinion amongst the tax experts that frequent the forum on the position when changing jobs. I read the legislation as allowing you to avail a second time within 5 years (although please note on each occasion it must be your intention to use the new bike mainly for commuting). Others read it as restricting eligibility to once every 5 years irrespective of numbers of employers.

TinyExplosions

It's hard to answer a lot of the questions with confidence, as the law is quite relaxed, and the majority of restrictions are placed by the employer, not by the revenoo.

You can pay it back in one lump sum, or over a period up to 12 months, depending on your company. A lot of them will have some provision whereby if you leave them before you've paid for it, the balance comes out of your final wage packet, and if that's not enough you have to make up the shortfall, or give them the bike as it's their property till it's paid for.

You save on tax, prsi and USC, and the company saves on prsi.

You can't transfer anything from one employer to another

cython

RacoonQueen wrote: »

I made the initial purchase with mine. Brought the receipt into work afterwards, they then transferred the same fee to the bike shop and the shop refunded me. This was all done 18 months ago though, it may have changed...

See in that sense your employer still actually made the "initial purchase", in that ultimately they bought the bike, and in essence your purchase never happened, save for perhaps being classed as a refundable deposit until payment could be obtained from your employer. That is how the accounts of both your employer and the shop will reflect the transaction, and really that is what the scheme requires/is concerned with.

noeleoreid

what if ur company doesen't have the bike to work scheme in place??.. which I know for a fact , mine don't! The employer will hardly be bothered accommodating just one person out of 70 in the work place. Effectively I will be asking him to start the scheme in my company. It would hardly even be worth his while even with prsi savings to do it for just one person.. would it?

He aint the most approachable boss in the world bout these things is why i ask..

Anybody been in this situation where its been just them and the employer as a once off rather than a multiple amount of employees taking part?

Idleater

noeleoreid wrote: »

Anybody been in this situation where its been just them and the employer as a once off rather than a multiple amount of employees taking part?

I've done just that (albeit with a smaller company).

I asked him if he would consider it, he said what's involved, I forwarded on the revenue information, he said he'd confirm with the accountants, the accountants responded with a set of criteria for me to agree to:

1) the bike cost was agreed at €1000 which was fine by me and I had an invoice from the bike shop for the bike that I wanted.
2) the payment (by cheque) would be at the same time as pay (end of month)
3) there would be no monthly payments (i.e. all in one go) again, fine by me.

So, last week, I got my payslip and a cheque that I brought to the bike shop.
Payslip indicates a pre-tax deduction of €1000 and my take home pay reduced by €480.

Now all I've to do is wait for the bike to come in.

The boss even said it was painless.

GT_TDI_150

noeleoreid wrote: »

How does it come up to 32% ? Is USC 12%??

you dont pay tax, PRSI or USC on the price of the bike, so you dont pay 32% on that money as it comes out of your wages before all the above are subtracted