Cycle Scheme working out more expensive?

Soldato
Joined
4 Feb 2007
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Nuneaton, UK
Does anyone know about Cycle Scheme or has anyone else done it?

I signed up last year after reading how much cheaper it can be with big savings.

I got a voucher for £1000 last year and bought a bike for actually a little over and paid the extra myself. I have paid £83.33 per month since May 13 to April 14, giving a total just a few pence off £1000. I thought it was all done and dusted. Now they have said I have 3 options.

Option 1 - Pay £70 for 36 months hire, then the bike goes back.
Option 2 - Pay £250 and the bike is mine.
Option 3 - Send the bike back at my cost.

This is not how I understood it working, it's costing me more than £1000 or I end up with nothing.

Is it just me or has something gone wrong somewhere? :confused:
 
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You save little bit as the the money comes out pre tax. But its a really poor scheme which was neutered a few years back. Looked into getting it and decided it was a joke.
 
You've been paying less tax through out the last year though ;)

This, basically.

A quick read of the FAQ on the cycle scheme website makes it clear what a "scam" it actually is.

You've basically been paying ~£70/month or ~£60/month (depending if you're a higher rate tax-payer) to hire a bike for a year.

Considering you could buy a pretty decent bike for 6 months worth of payments, and it would be yours, it seems like a bit of a pointless scheme.

In fact, that payment could probably cover your petrol costs (depending on what you drive) so it would make more sense to just drive to work in comfort and stay dry in the rain, warm in the snow, and cool in the sun.

Edit:
I have no idea what I have saved in tax, any clever people able to work it out?

You will have saved ~£160 or ~£280 over the year depending what rate tax you pay (this will vary depending on what other benefits/tax relief/etc you get)

I already have a car, I sold my personal car and now have a company car.

You've been had :(
 
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£83.33 has been taken from your GROSS salary thus saving you a minimum of 20% tax (so in theory - £66.66 a month x 12 = £799.92) -thats assuming your a basic rate tax payer

So you've paid £800 for the £1000 voucher in net terms. Pay the £75 and be done - they never ask for the bike back at the end.

So you've paid £875 in total for the £1000 bike.

Savings aren't as good as they used to be on the old scheme but that was a joke and the government put a stop to it quickly.

In other words if you have paid £1000 for the bike from you monthly net wage (i.e once it was in your account - you would already have paid 20% tax to get the money there)
 
Yeah, it used to be the employer could give you the bike after the year either for free or charge you a nominal ammount, but the tax man caught wind and said he wants a percentage of the bikes value instead.

Are you sure about option one? I paid the smaller of the two ammounts and after x ammount of months they have no interest in the bike and don't want it back.

It saved me some small ammount of tax contributions, but I essentially just looked at it as an intrest free loan for a year, to buy a bike.
 
The way the scheme works, you haven't been paying off a loan on the bike but paying rental. At the end of the rental period ownership of the bike can be transferred to you at fair value, which for a £500+ bike that's 1 year old is 25% of the purchase price.
 
Option 1 - Cyclescheme's Extended Use Agreement
Pay a small, one-off, refundable deposit of £70.00, maximising your savings. You will be able to 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, then 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.

Could be good unless they decide the take the bike back afterwards.

I can't actually use the bike for work as my job is field service, most jobs are at least 100 miles away and I have to carry tools. The scheme doesn't stipulate that you have to actually cycle to work, I just use it for leisure.
 
Yeah, I've just checked my contract after thinking, I'm actually technically only borrowing it for another 36 months as well, I though I took ownership after that, although the consensus seems to be that the bike will be worth not a lot at the end of 4 years, so will likely just take ownership.
 
Could be good unless they decide the take the bike back afterwards.

Just say you lost it, and if they want reimbursement.... well, how much is a 4 year old bike worth anyway? At the depreciation rate they've applied for your one year usage (75% per annum), it will be worth £3.90

It's a crap scheme, though. We've recently been offered it, but I couldn't really see the upside.
 
Over £1,000 for a push bike!

You could have bought a decent second hand car for that.

No you could have bought a banger with 100k on the clock that will require excessive servicing for that.
Not that it helps the OP, but my work actually got rid of the work scheme and set up their own because they felt it wasnt fair. We essentially get loans now, with no big payments at the end of it.
 
I like how everyone is telling the OP to just drive his car. Perhaps he's trying to help the environment and keep fit?

Shush, you. No place for that here.

Could be good unless they decide the take the bike back afterwards.

I can't actually use the bike for work as my job is field service, most jobs are at least 100 miles away and I have to carry tools. The scheme doesn't stipulate that you have to actually cycle to work, I just use it for leisure.

Take option 1. They're unlikely to want the bike back at the end.
 
It saved me some small ammount of tax contributions, but I essentially just looked at it as an intrest free loan for a year, to buy a bike.

I guess if you already want a £1,000 bike, and look at it like this, then fair enough.

If you look at it the way it's pitched though (as an incentive to get people out of their cars and cycling to work), then it's utterly pointless.
 
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