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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To be mighty annoyed the gov are going to give us a tax bill for dp's Bike to Work bike he bought over a year ago!!!

16 replies

MilaMae · 14/08/2010 14:36

Apparently according to the Guardian they're going to be charging tax retrospectively for bikes bought on this scheme.

How can they do that?

Dp bikes to work several times a week to save money and to do the right thing however we would never have bought the bike if we knew this would happen. The only reason we could afford it was because of the scheme.

OP posts:
chandellina · 14/08/2010 14:46

i read that story too and thought what a scam! after a year you pay only 5% of the sticker price? Even if they up it to 18%, it is an amazing deal.

so why are you upset?

Original poster
MilaMae · 14/08/2010 15:14

Because we've finished paying for it ages ago. We budgeted for the monthly payments going out of dp's pay each month only not for a tax bill we're going to get now.

The only reason we could afford for dp to get said bike was because of the monthly payments we budgeted for at the time- however good a deal it was. The reason they made it attractive was to lure people out of their cars.

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RustyBear · 14/08/2010 15:19

You don't get a bike for 5% of the ticket price, chandellina- you make monthly payments via the salary sacrifice over the year as well.

chandellina · 14/08/2010 15:26

ok, i read the faqs but it still is a good deal. If I bought a £500 bike and paid my 12 monthly payments, I might now be on the hook for a bit under £100 rather than £25 if I bought the bike. It's still a savings of at least £100 from buying it myself.

Original poster
MilaMae · 14/08/2010 15:32

It's still more than we budgeted for and a lot. All well and good for people who are about to use the scheme as they can just buy a cheaper bike to keep on budget or not at all if they can ill afford it for those that finished paying for it ages ago it's unfair. We signed up for what we signed up for.

Also lets not forget said cyclists are also doing a lot of car driving commuters(and the environment) a favour.

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chandellina · 14/08/2010 15:41

i read it that it's only applicable if you're only part way through their scheme.
i agree it's lame of them to change the rules after the fact ...
but it sounds like there is still a decent tax break in there for newcomers.

Original poster
MilaMae · 14/08/2010 15:50

So does that mean we won't have anymore to pay then? The article was a bit ambiguous,we finished paying 18 months ago.

Still not fair for those on the scheme,can't see how they can just change the rules. Will put quite a few people off from signing up incase they did the same again.

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minibmw2010 · 14/08/2010 17:47

I can understand your frustration at having the rules changed (I do think that they are going to force payment from anyone who has benefited since the scheme started so yes you may well have to pay). However, you've probably benefitted by DH being able to get a bike he'd maybe not normally be able to afford and even with a tax bill on top, it'll still be relatively more affordable. I guess you'll just have to wait and see what they do ..

PS: My DH has bought 3 bikes under this scheme, so I do sympathise.

tyler80 · 14/08/2010 17:56

They haven't changed the rules. Just clarified them. Since the beginning of the scheme they've never guaranteed the final payment, because if they did this it would be cease to be a tax free benefit. In the same way, because it's a salary sacrifice, your salary doesn't actually have to go back up to your original earnings at the end of the hire period.

Personally I think it was a rubbish scheme anyway. Abused by the high earners to get cheap bikes, not available to the lowest paid and most in need and I'm very dubious about the numbers of new cycle commuters it has created. At my place of work they have given out 30,000 pounds worth of vouchers, I have seen one new bike appear in the bike sheds.

ItsAllGoingToBeFine · 14/08/2010 18:01

Actually you don't own the bike until you make the final payment. You rent the bike from your employer for a year, at the end of that year, your employer can choose to sell on the bike at a fair market price (most actually sell it at a lot less than this)

fedupofnamechanging · 14/08/2010 18:01

Regardless of how good a deal it may/may not be, it is fundamentally wrong to change the terms of an agreement after the fact. I think the govt may find this hard to enforce legally. If they did manage to change the rules it sets a dangerous precedent for all the other areas of our lives

ItsAllGoingToBeFine · 14/08/2010 18:08

They haven't changed the rules of the agreement. The final payment was meant to involve paying fair market price for the bike. 5% is just taking the piss unless you bought it from Asda.

NoahAndTheWhale · 14/08/2010 18:17

DH has recently joined the scheme and is cycling to work now. Bit annoying to hear he will probably need to pay more but is life I suppose

ItsAllGoingToBeFine · 14/08/2010 18:24

He doesn't have to buy the bike at the end Wink

NoahAndTheWhale · 14/08/2010 21:17

I think he will want to though :)

Original poster
MilaMae · 15/08/2010 17:36

They are used a lot at my dp's work and at several of his friend's places of work.

He cycles 13 miles each way as do many others. They even have showers and have been given cycle shirts from the company.

Dp has a contract re the scheme so will be interesting to see how they attempt to get more tax out of him for it especially when he's long since paid for it.

I do think it's a good scheme as many people wouldn't be able to cycle to work and now can.I just hope this all doesn't put people off.

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