Cyclescheme messing me about!

SexyGreyFox · 7 Feb 2016 at 11:44

Let's go back 3 years -

We will shortly be in touch to offer you the following 3 options.

1. Cyclescheme's Extended Use Agreement (EUA)
Pay a small, one-off, refundable deposit (3% or 7% of the equipment value) and continue to use the bicycle for an extended period of up to 36 months. There are no monthly rental payments during this period and you can participate in the scheme again if you wish.

At the end of this period, if you do not wish to keep the bicycle, we will refund the deposit in full. Cyclescheme may at its discretion, offer ownership of the bicycle to you at this point, and no further action or payment will be required if you wish to keep the bicycle.

So I contacted them by phone just to make sure they will offer me the bike free of charge after the 3 years which they confirmed. This was also confirmed by members on here who also told me to sell the bike because I didn't really want it at that point.

This agreement came through which worried me so I rang them up -

CONFIRMATION OF EXTENDED USE PERIOD

This is confirmation that the payment of your 'continuation deposit' has been processed and is now complete. Therefore, you can remain in possession of the Equipment as described in the Extended Use Agreement for a further 36 months.

During the Extended Use Agreement the Equipment will remain the property of Cyclescheme Ltd and you should not dispose of it in any way. You must continue to use the bike mainly for commuting purposes, and if you are unable to continue to meet the terms and conditions of the Agreement it is your responsibility to inform Cyclescheme by email to [email protected].

At the end of the Extended Use Agreement Cyclescheme will contact you and may offer ownership of the bicycle at the market value; the market value to be ascertained at the time in accordance with HMRC guidelines.

They confirmed that I wouldn't have to pay anything at the end of the 3 years. I believe OCUK members also said the same.

Today I get this email -

Your Extended Use Period is due to end on Aug 7, 2016 and we will contact you around this time to arrange a visit by one of our representatives to view the bicycle. At this point you will be offered two options:

Option 1
To be offered ownership of the bicycle at the market value; the market value to be ascertained at the time in accordance with HMRC guidelines.

Option 2
Return the bicycle to Cyclescheme and we will return the deposit in full

So has anybody else got to this point with this BS?
I wish I had kept in email contact and not rung them so I would have had backup of what they said on the phone.
Not very happy and it's a good job I didn't sell the bike.

[TW]Sponge · 7 Feb 2016 at 11:50

So basically you don't save any money atall and it works out more expensive in the long run? I just opted for the 3 year extension on mine and bought another bike through the scheme. Hope they don't give me this BS.

SexyGreyFox · 7 Feb 2016 at 12:00

I had an £849 bike and for the first 12 months paid £50/month = £600
I then had the extended user agreement at £57 = £657

It is now possible they could come back and say that bike is worth £350 which means I've paid way more.
I'm expecting them to come back and say £200 so I've paid exactly what I borrowed.

[TW]Sponge · 7 Feb 2016 at 12:17

SexyGreyFox said:
I had an £849 bike and for the first 12 months paid £50/month = £600
I then had the extended user agreement at £57 = £657

It is now possible they could come back and say that bike is worth £350 which means I've paid way more.
I'm expecting them to come back and say £200 so I've paid exactly what I borrowed.

That's different to mine. I had a £600 bike and payed £50/month 12 months which is the full cost payed for. I then however had to pay a £42 (refundable I think/hope) deposit to keep the bike for another 3 years. Then they said they will get back to me with more options once the hire agreement has ended.

I'm annoyed because I have already payed for the bike, so why the hell should I have to 'hire' it again for the next 3 years? I have just gotten a new bike on the scheme as I am unable to afford one straight up, but I think this will be the last time as I feel as though I'm getting conned somehow.

Vonhelmet · 7 Feb 2016 at 12:48

So is the bike now 4 years old? I'd fully expect them to say the market value is nil. Check that point. It may be that the letter of the law is that you get it at mv, but if that mv is nil then it's no problem.

For tax purposes, hmrc basically say that a year old bike that cost over £500 is worth 25% of its original cost. I imagine they'd be happy that a 4 year old bike is essentially worthless.

Vonhelmet · 7 Feb 2016 at 12:51

Edit:

http://www.hmrc.gov.uk/manuals/eimanual/eim21667a.htm

7% of the original value, so that's £60, near as damn it.

Vonhelmet · 7 Feb 2016 at 12:52

Double post.

SexyGreyFox · 7 Feb 2016 at 13:28

Vonhelmet said:
Edit:

http://www.hmrc.gov.uk/manuals/eimanual/eim21667a.htm

7% of the original value, so that's £60, near as damn it.

Thanks, I would pay that but feel I shouldn't be paying anything.

Vonhelmet · 7 Feb 2016 at 13:30

In fairness, it was in the agreement that you'd pay mv at the end of the period. Odd that they said otherwise, though.

SexyGreyFox · 7 Feb 2016 at 13:33

[TW]Sponge;29146941 said:
That's different to mine. I had a £600 bike and payed £50/month 12 months which is the full cost payed for. I then however had to pay a £42 (refundable I think/hope) deposit to keep the bike for another 3 years. Then they said they will get back to me with more options once the hire agreement has ended.

I'm annoyed because I have already payed for the bike, so why the hell should I have to 'hire' it again for the next 3 years? I have just gotten a new bike on the scheme as I am unable to afford one straight up, but I think this will be the last time as I feel as though I'm getting conned somehow.

For Cyclescheme those figures don't add up.
In your first 12 months you pay back 2/3 of the price of the bike/accessories and then pay the extended hire agreement.
If you are correct you should have had an interest free loan which most bike shops will do.

Vonhelmet · 7 Feb 2016 at 13:41

If you got a £600 bike you're paying back £50 per month before tax, not after, so more like £34 per month.

SexyGreyFox · 7 Feb 2016 at 13:43

Just looked, my £849 loan had me paying 12 x £46 in the first 12 months.

DaleTheWhale · 7 Feb 2016 at 14:45

The deposit you give them for the extra 3 years is the final payment IFAIK.

So you've paid £552 in the first year and a £59.43 deposit to then own it for 4 years, this is all you will pay, they keep the "deposit" when you choose to keep the bike after 4 years or you can give them the bike back, receive a refund on your deposit and you paid £552 to own a bike for 4 years.

I think the wording of their email confuses everything as it seems as if they're going to take a 3rd payment, when in fact they already have your payment/deposit and just keep it.

SexyGreyFox · 7 Feb 2016 at 16:31

ThaReaperGuy said:
The deposit you give them for the extra 3 years is the final payment IFAIK.

So you've paid £552 in the first year and a £59.43 deposit to then own it for 4 years, this is all you will pay, they keep the "deposit" when you choose to keep the bike after 4 years or you can give them the bike back, receive a refund on your deposit and you paid £552 to own a bike for 4 years.

I think the wording of their email confuses everything as it seems as if they're going to take a 3rd payment, when in fact they already have your payment/deposit and just keep it.

However, it's there in yellow and it doesn't look like I've got a leg to stand on.

At the end of the Extended Use Agreement Cyclescheme will contact you and may offer ownership of the bicycle at the market value; the market value to be ascertained at the time in accordance with HMRC guidelines.

Your Extended Use Period is due to end on Aug 7, 2016 and we will contact you around this time to arrange a visit by one of our representatives to view the bicycle. At this point you will be offered two options:

Option 1
To be offered ownership of the bicycle at the market value; the market value to be ascertained at the time in accordance with HMRC guidelines.

Option 2
Return the bicycle to Cyclescheme and we will return the deposit in full

of course, as pointed out, the market value could be zero or as little as £60.

UTmaniac · 7 Feb 2016 at 16:56

These schemes have completely messed up the UK bike market, shops started charging more to cover the scheme admin fees, so we get less bike for the money compared to ~2008 (taking account of inflation). In recent years, HMRC changed the game by asking for silly ownership transfer fees, making the schemes very questionable for basic rate tax payers.

These days, it is far easier to look for sale prices, perhaps in combination with benefits your employer might offer eg. shop vouchers purchased at a discount.

Vonhelmet · 7 Feb 2016 at 17:08

Given that bike shops don't have to adopt the schemes, or that many charge their admin fees just on cycle scheme purchases, I'm not sure it's fair to say that shops have uniformly upped their prices.

eXist · 7 Feb 2016 at 18:21

UTmaniac said:
These schemes have completely messed up the UK bike market, shops started charging more to cover the scheme admin fees, so we get less bike for the money compared to ~2008 (taking account of inflation). In recent years, HMRC changed the game by asking for silly ownership transfer fees, making the schemes very questionable for basic rate tax payers.

These days, it is far easier to look for sale prices, perhaps in combination with benefits your employer might offer eg. shop vouchers purchased at a discount.

You have no evidence to backup anything you ve said. I cant be bothered to link my own but in a nutshell your wrong on both points. Ta

edit - in fact perfect example. 2016 Giant Defy 0 with Ultegra components. Far better spec/price than in 2008 and that's one of cycleschemes best selling bikes.

SexyGreyFox · 7 Feb 2016 at 18:31

UTmaniac said:
shops started charging more to cover the scheme admin fees,

This is true.

1) First bike cost £849 on Cyclescheme and the payback is the reason for this thread.
2) 2nd bike was bought because (and no arguing) after a bad accident that I'm still suffering from, I didn't feel safe on a road bike in winter so paid £279 cash for a more suitable bike which I loved and felt a lot safer on.
3) Decided on another bike which was £800 so was going through Cyclescheme when I was informed by the shop that it would cost £50 extra but if I bought it cash I could have it for £700 - no brainer.
4) I worked out the Cyclescheme payments for a 4th bike and it would be easier to have a £750 bike on interest free and own it immediately.
5) 5th bike cost £150 off Gumtree and it's the one I constantly use.

Bike 1 sits in the shed rotting, bike 2 & 3 have been sold.

eXist · 7 Feb 2016 at 19:14

SexyGreyFox said:
This is true.

1) First bike cost £849 on Cyclescheme and the payback is the reason for this thread.
2) 2nd bike was bought because (and no arguing) after a bad accident that I'm still suffering from, I didn't feel safe on a road bike in winter so paid £279 cash for a more suitable bike which I loved and felt a lot safer on.
3) Decided on another bike which was £800 so was going through Cyclescheme when I was informed by the shop that it would cost £50 extra but if I bought it cash I could have it for £700 - no brainer.
4) I worked out the Cyclescheme payments for a 4th bike and it would be easier to have a £750 bike on interest free and own it immediately.
5) 5th bike cost £150 off Gumtree and it's the one I constantly use.

Bike 1 sits in the shed rotting, bike 2 & 3 have been sold.

ive never heard of shops charging an "admin fee" when using cyclescheme, if any shops do then you should use one of the thousands of others that don't. The only time we ever alter the price of a bike under a bike to work purchase is if the bike is already on sale eg

we are doing 2015 defy 0s at £800 from £1000

if you wanted to buy that bike from us using an £800 c2w voucher we would only get £720 so we charge the customer the £80 difference as you cannot/will not lower the price any more. Almost every shop/website uses the term "cannot be used in conjunction with other offers" this is roughly the same thing.

cheesyboy · 7 Feb 2016 at 19:27

You won't pay any more because the extended deposit was refundable and just happens to be exactly equal to market value at the end of the rental period.

They can't just say they'll give it to you because that has tax implications.