Rachel Reeves has drawn up a plan to cut tax benefits for workers using salary sacrifice schemes to buy expensive manual and electric bicycles, according to a report.
The chancellor is expected to introduce a new limit on how much people can spend on a bicycle through the cycle to work scheme in this month’s budget, the Financial Times said, citing people familiar with budget preparations, amid concerns that subsidising cycle purchases is not the best use of taxpayers’ money.
One government figure told the newspaper: “Cycle to work should be about helping ordinary commuters switch to greener travel, not giving tax breaks to high earners buying £4,000 e-bikes for weekend rides in the Surrey Hills. Taxpayers shouldn’t be footing the bill for luxury leisure.”
Bugger the scheme entirely. And all such as well. If x is the amount of tax we want then x is the amount. Whether you spend y – some amount of x – on a bike, an EV or whatever is nowt to do w’ it.
Cycle to work was always a bit of a boondoggle, but this vexes:
Taxpayers shouldn’t be footing the bill for luxury leisure.
It’s a tax relief. The taxpayer is not paying for this, the taxman is just taking a bit less.
Yes, which means either the deficit is higher, or they have to raise rates elsewhere.
Money is fungible. Though I’m surprised a “journalist” actually got this correct. Probably by accident.
Thats Spud’s position – the fact the State allows you to keep any of your money is down to its benevolence. It all belongs to the State and it just allows you to keep some of it. I don’t think thats a very popular view around these parts.
Therefore if a burglar comes into your house and nicks everything apart from your fridge, he has very generously given you a fridge.
Well no, because the Spud position is that ‘your’ house and its contents actually belong to the ‘burglar’ and if he has taken back some of his assets then thats perfectly fine, you have nothing to complain about because none of it was yours in the first place. If he’s left you with a house and fridge that is to his credit in fact.
Isn’t this a fairly complex scheme with masses of paperwork? Don’t tell me that once again they failed to get it right. I’d probably just scrap it and cut taxes.
of course sadly they wont cut taxes, but instead spaff the tax money on some useless toss.
Bought a few bikes over the 15 or so years my company ran the scheme, and there was a limit as to how much you could spend. Not complicated from my experience – apply for a certificate, have a butchers at what Halfords / Evans offer on their website, pick a bike and enter the code.
One colleague bought a Brompton and promptly sold it…….
When it first started I used it to buy a bike but never used it to cycle to work, I did use it to cycle before work rather than go for a run.
I had a lad who worked for me who did running/riding biathlons and was in the county cycling team. He used it to buy a new £2,000 front wheel for his race bike and he used his former race wheel on his training bike when he cycled 30 miles to work and back.
“When it first started I used it to buy a bike but never used it to cycle to work”
Tut
To qualify for the scheme, the bike must be used ‘mainly’ for commuting or business purposes such as going to see a client.
But of course, no-one monitors this!
Indeed – HMRC actually says this in their internal instructions – basically saying “we can’t be arsed to monitor this and will just take the employer/employee’s word for it – unless there’s strong evidence to the contrary”, such as a comment on a website that “I used it to buy a bike but never used it to cycle to work”
Il just have to hope their records don’t go back 20 years.
Oops. Oh well, never mind 😉
“Isn’t this a fairly complex scheme with masses of paperwork?”
It’s MADE an overly complex scheme by those that implement it using loans and repayments and all sorts of complications which aren’t necessary.
For a small OMB which wants to give a bike to its director/owner the scheme consists of:
Company buys bike
Company lets owner/director use it
And, er, that’s it.
Yup. I did that. Ended up not using the bike much. Too much hassle around my way; clients too far away, down the hill, roads too dangerous, and my work bag too big and heavy. Had some fun with a tag-along on it when the nipper was small, though.
I wouldn’t want to carry a piano round by bike either. It would be even worse than carrying one up a flight of steps: https://www.imdb.com/title/tt0023251/
Nah, I only planned on using the bike for sessions when I was booked on kazoo
Got to provide public sector jobs for all those useless graduates somehow!
Back when I was working I cycled to work quite a bit, as did some of my colleagues. Our workplace decided to take a look at the cycle to work scheme so we checked out the website. The process appeared to be such a byzantine labyrinth of pointless bureaucracy that we decided not to bother.
My employer offers salary sacrifice for a gym, dental cover, roadside assist, AVCs into a pension, some matched pension up to 6%, EV car, bicycle and half dozen others. It’s ridiculous. And if I took the lot it would be illegal – I tried it out and it flagged that it took my earnings below the minimum wage and that not allowed even if both parties consent.
Agree with Tim, get rid entirely.
My employer offers this though with a limit. I used it to buy an eBike from a reputable brand as this is also promoted quite heavily by my employer and also the cycle to work scheme they use.
It turns out however that our company policy forbids parking an eBike in the company’s car parking facilities so I never use it to cycle to work, instead, parking my Tesla (also purchased through a similar scheme) in the same car parking facilities.
My company clearly as joined up as any government party.
How much does this scheme “cost”? Is it even 1% of the NHS per annum?
I find it hard to believe that the cost of buying a bike stops people from cycling to work.
The main problems are
a) distance
b) traffic
c) the high probability of it being nicked
Particularly c in urban areas.
100%
David, my strategy to avoid all of that back when I was a uni student was
a) buy a cheap, second hand, pretty decent road bike
b) strip it back to the frame, anti rust coat then a shitty club colours spray coat on top. Black and red for me.
c) learn to ride in traffic.
d) never worry about it getting nicked because it looked fucking awful. On purpose.
Yes, cost of the bike had nothing to do with it. And it served well for years afterwards. The idea that people need a tax deduction for a vehicle bemuses me.
A bit depressing that b is needed. I should have added d) If not nicked vandalised.
Oh well, I suppose people will turn to getting BMWs on Motability instead.
cue job losses in the bike importation business area