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Cycle2Work Scheme

JKC

Hi All,

I'm looking into buying a bike through the cycle to work scheme, I was hoping to buy something from the Planet-X website, but I don't know if that would be covered under the cycle to work scheme, anybody else looked at buying from a site in the UK, CRC, Wiggle, etc via the scheme?

If so can you let me know how you did it\ what was involved?

Thanks,

JKC

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penexpers

You can get it from the Planet X website if your employers allow it.

07Lapierre

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

macnab

I was looking at saving a few quid by buying off the net too, but I bought in a local shop instead because: they set the bike up to fit me, saving possible physio bills and increasing the comfort of the bike, and they are 30 minutes away so visiting them is easy if I need to make use of my 1 year warranty.

You can buy Planet X bikes in Ireland.

http://www.donedeal.ie/for-sale/gentsbicycles/1534934

07Lapierre

JKC wrote: »

Hi All,

I'm looking into buying a bike through the cycle to work scheme, I was hoping to buy something from the Planet-X website, but I don't know if that would be covered under the cycle to work scheme, anybody else looked at buying from a site in the UK, CRC, Wiggle, etc via the scheme?

If so can you let me know how you did it\ what was involved?

Thanks,

JKC

In My case it worked like this

I went to my LBS and picked out my bike (€1200) i paid the extra €200
Went to my employer and they gave me a cheque for €1000 made payable to the LBS.
I signed a letter declaring i was buying a bike under the BTW scheme.
My employer deducted €200 from my salary over 5 months ( my choice).

That was it!

If you employer has a contract/arrangement with certain bike shops, then you may be limited in your choice of bike/where you can buy etc. In my case i could have bought from any shop or over the internet.

dr ro

i got a bike last year under b2w scheme. Mtb perfect for mtbing carrying the kids etc. Now i'm thinking i wouldn't mind a better road bike for 60k round trip to work. Can you do scheme again does anyone know?

07Lapierre

dr ro wrote: »

i got a bike last year under b2w scheme. Mtb perfect for mtbing carrying the kids etc. Now i'm thinking i wouldn't mind a better road bike for 60k round trip to work. Can you do scheme again does anyone know?

Every 5 years. so you can go again in 2014/15

gar120

So when you say our employer deducted €200 from your salary over 5 months you mean that you pain the full cost of the bike?

Beasty

gar120 wrote: »

So when you say our employer deducted €200 from your salary over 5 months you mean that you pain the full cost of the bike?

It was deducted from gross salary, so he saved the tax, PRSI and levy

07Lapierre

gar120 wrote: »

So when you say our employer deducted €200 from your salary over 5 months you mean that you pain the full cost of the bike?

No, they deduct 200 from your gross salary, so the result is you are taxed on a smaller amount each month.

route66

07Lapierre wrote: »

Every 5 years. so you can go again in 2014/15

Or whever you like, as long as you are in a new job

penexpers

route66 wrote: »

Or whever you like, as long as you are in a new job

Nope, it's tied to your PPS number, which follows you from job to job. Use it twice in 5 years in suspect Revenue will notice.

Hungrycol

penexpers wrote: »

Nope, it's tied to your PPS number, which follows you from job to job. Use it twice in 5 years in suspect Revenue will notice.

Haven't heard of this. The Revenue have no way of knowing if you used it or not and I don't see how it can be ties to your PPS number. There no obligation on employers to notify the Revenue who has used it (that I know of anyway).

penexpers

Hungrycol wrote: »

Haven't heard of this. The Revenue have no way of knowing if you used it or not and I don't see how it can be ties to your PPS number. There no obligation on employers to notify the Revenue who has used it (that I know of anyway).

I would say there is a section in the employers tax return that asks the employer to list all employees who used the BTW scheme. (same as any other benefit I would imagine).

Beasty

It's definitely per employment. If you move jobs there is absolutely nothing to stop you taking advantage of it again within the 5 years. The legislation works to exempt the cost from the benefit in kind rules, which can only be applied by reference to specific employments,

There is no reporting required by the employer, although the Revenue can, of course, audit the company's records

Sr. Assumpta

JKC wrote: »

Hi All,

I'm looking into buying a bike through the cycle to work scheme, I was hoping to buy something from the Planet-X website, but I don't know if that would be covered under the cycle to work scheme, anybody else looked at buying from a site in the UK, CRC, Wiggle, etc via the scheme?

If so can you let me know how you did it\ what was involved?

Thanks,

JKC

I found all the info here http://www.bikescheme.ie/frequently-asked-questions quite useful.

I wouldn't dilly dally either, no telling how much longer Kermit and the other Muppets will be running the show ("The Lovely Enda" may not be so bike-friendly), also things could change post budget etc.

mookie2007

Beasty wrote: »

It's definitely per employment. If you move jobs there is absolutely nothing to stop you taking advantage of it again within the 5 years. The legislation works to exempt the cost from the benefit in kind rules, which can only be applied by reference to specific employments,

There is no reporting required by the employer, although the Revenue can, of course, audit the company's records

It is definitely not per employment. Its 5 years full stop and the 5 years follow the pps number. Every employer has to disclose the benefits of each employee to the Revenue Commissioners in the P35 end of year annual return.

If you try to use the bike to work scheme more than once within the 5 years you are basically committing tax fraud.:eek:

Beasty

mookie2007 wrote: »

It is definitely not per employment. Its 5 years full stop and the 5 years follow the pps number. Every employer has to disclose the benefits of each employee to the Revenue Commissioners in the P35 end of year annual return.

If you try to use the bike to work scheme more than once within the 5 years you are basically committing tax fraud.:eek:

From the Revenue Guidance Document:

9.9 How will the exemption operate? Does an employer have to notify Revenue that they are providing bicycles/safety equipment for directors and employees? What kind of documentation is required?

There will be no notification process involved but the purchase of bicycles and associated safety equipment by employers for directors and employees will be subject to the normal Revenue audit procedure with the normal obligations on employers to maintain records (e.g. delivery dockets, invoices, payments details, salary sacrifice agreements between employer and employee, signed statements from employees that the bicycle/bicycle safety equipment is for own use and will be used for travelling to and from work).

It is not a reportable benefit, as it's exempt from the BIK provisions by virtue of Section 7 Finance (No 2) Act 2008

Now I've given you my source. What's yours?

EDIT - I would welcome you providing something definitive to support your position on this, as I have scrutinised the legislation and can find no basis for it.

Beasty

You may be focussing on this part of the legislation

A director or employee shall not, by virtue of this subsection, be relieved from a charge to income tax under subsection (1) more than 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

I read this by reference to the employment or directorship in question - you cannot obtain relief twice within 5 years by reference to that employment. In essence that is how BIK legislation works - it can only be by reference to individual employment, as any new employer has no way of knowing what benefits have been obtained in a previous employment. If it was to apply to the individual (and it would be impossible to track if it did), the legislation would refer to "individual" or "taxpayer", not "employee". Ultimately it is for employers to apply the BIK legislation, not employees

My interpretation may well not be in the "spirit" of the legislation, but it is, in my view, within the letter of the law.

mookie2007

My source is revenue. We had the exact issue with a new employee. He was looking to purchase a bike under our bike to work scheme. Anyway i am in charge of the scheme. He let slip that he already purchased a bike under the bike to work scheme and made the same arguments. I told him as far as i was aware he was not entitled to a 2nd bike under the scheme within 5 years.

To clear it up i contacted the revenue commissioners and they basically said that it was every 5 years per person/pps and any breach of this is implicit tax fraud. Not only that but the revenue official said the employer had an obligation to ensure that processes existed to eliminate this occurring.

If you think about it practically the bike 2 work scheme was setup by a public servant. Public servants dont change jobs really whereas private sector workers change all the time volunarily & involuntarily. Do you think a public servant would orchestrate a scheme whereby public sector workers can only avail of the scheme every 5 years whereas a private sector worker could avail of it everytime they change jobs.

Beasty

Thanks mookie2007.

IMO the Revenue are wrong on this, but I would always err on the side of caution when such small amounts are involved, as the costs of arguing it will outweigh the potential benefit.

The Revenue official is clearly wrong with his assertion that the employer had an obligation to ensure that processes existed to eliminate this occurring, which in my view casts serious doubt over his technical argument anyway.

NB, I have spent the past 25 years arguing technical issues with tax authorities - with something like this they would not want to test it either.

mookie2007

Beasty wrote: »

Thanks mookie2007.

IMO the Revenue are wrong on this, but I would always err on the side of caution when such small amounts are involved, as the costs of arguing it will outweigh the potential benefit.

The Revenue official is clearly wrong with his assertion that the employer had an obligation to ensure that processes existed to eliminate this occurring, which in my view casts serious doubt over his technical argument anyway.

NB, I have spent the past 25 years arguing technical issues with tax authorities - with something like this they would not want to test it either.

I commend your spirit in arguing the technical issues Beasty but as you say when your talking about such a small amount it just aint worth it having the revenue knocking on your door.

I had a heated argument with the revenue official regarding the employers obligations. Its ridicolous but revenue policy is to push as much of the responsibility on the employer because its easier to monitor.

Anyway just sharing my experience on this issue with you all

Beasty

There's definitely a difference between theory and practice at this level. Based on what you said, it's clear to me the Revenue official did not understand the law, and couldn't be bothered to get to understand it. They simply wanted an easy life so took the soft option of giving you an "interpretation" that was favourable to the Revenue, knowing the amounts involved would not cover the cost of getting formal advice on it.

As I suggested, it's not worth arguing for the amounts involved, but I am still pretty confident over the technical position;)

73trix

Am thinking of the scheme but worried in case I change jobs. I would like to take it up before it closes, but what if I move jobs? Ccan I pay the amount owed to employer in full? Or can I transfer to another employer payroll, even if the same agency? (I suspect not!)

cython

73trix wrote: »

Am thinking of the scheme but worried in case I change jobs. I would like to take it up before it closes, but what if I move jobs? Ccan I pay the amount owed to employer in full? Or can I transfer to another employer payroll, even if the same agency? (I suspect not!)

If you and your employer agree, there is no reason why the entire sum that you are paying under the scheme can't be taken out of your first pay packet after availing of it, and it may even be possible for you to outright pay your employer a balance if the sum is less than the pay packet, but I am less certain on that. If you change jobs, I'm pretty sure that you would have to repay the full amount (have the remainder deducted from final wage packet) to your employer at that point

Beasty

You need to check your employers rules, but there would normally be a provision to pay the balance due on termination of employment (either as a payroll deduction or by payment to the employer). It is possible (but unlikely) that they would not collect the balance, in which case you'll be getting an even bigger discount;). Either way, they cannot claw the bike back of you, as it's transferred to your ownership at the outset

There is absolutely no transferring between independent employers schemes

Diego Murphy

cython wrote: »

If you and your employer agree, there is no reason why the entire sum that you are paying under the scheme can't be taken out of your first pay packet after availing of it, and it may even be possible for you to outright pay your employer a balance if the sum is less than the pay packet, but I am less certain on that. If you change jobs, I'm pretty sure that you would have to repay the full amount (have the remainder deducted from final wage packet) to your employer at that point

It might be different for various companies, but I know where I work that if you cease your employment with the company, the remaining balance of the cost of the bike is deducted from your final pay packet and if this doesn't cover it, then you have to pay the balance