Bike to Work scheme - the Megathread - Read post #1 before posting

grey_man

seamus wrote: »

Yuck.

Anyone who supplies goods valued more than €10,000 to a public body in a given 12-month period is required to obtain a tax clearance certificate to continue working with that body.

In your case, CRC have probably supplied 10 bikes before yours, meaning that they now need a TCC.

http://www.finance.gov.ie/documents/circulars/circ432006.pdf

Page 4:

7.2.1 Non-resident contractors who are registered for Irish tax and who do not have
a permanent established place of business in the State should be advised to apply for
tax clearance to Dublin City Centre Revenue District, 9/15 Upper O’Connell Street,
Dublin 1.

CRC are based in the UK, but registered for Irish VAT, so the above applies to them. You can let CRC know that they only need to do this once and it will clear them for all bikes supplied to all public bodies in ROI.

Hi Seamus,

Thanks for the reply. I now see why my employer insists on getting a Tax Clearance Cert Ref No from my supplier.

I sent an email to CRC asking whether or not they had one and also explained why one is actually required. They seem to think an Irish Vat number will suffice ( maybe it would for private sector? ).

I just can't help but think that I can't be the first of all the public sector workers out there to try CRC. Especially when it was so highly recommended by so many of my co-workers ( there's a decent cycling culture in my job ).

I really hope that CRC made a mistake and they actually do have a TCC number so I can go ahead with my C2W application.

Thanks again,
John.

seamus

It might be the case that their AR department who do the invoicing just need to talk to their internal accounts guys. I was thinking last night, like you are, that CRC must have supplied well over that amount to public sector bodies at this stage, so they probably have the cert already.

Morf3h

Hi all,

I got an invoice from my bike shop to buy a bike for €1000 back in May.

Company paid it etc and I got the bike.... grand.

Just checked my payslips for the last four months and think they've over-deducted me for the bike.

How much should my wage be deducted by over a four month period?

Thanks,

M.

seamus

Uh, €250/month.

It comes out of your gross, so you should see a simple deduction in the payslip of €250. Don't bother trying to work out what it should be after tax, because it'll just melt your head.

reilig

Morf3h wrote: »

Hi all,

I got an invoice from my bike shop to buy a bike for €1000 back in May.

Company paid it etc and I got the bike.... grand.

Just checked my payslips for the last four months and think they've over-deducted me for the bike.

How much should my wage be deducted by over a four month period?

Thanks,

M.

If it helps, the cost of my bike was deducted from one payslip. Eur 1000. In real terms, the bike cost me EUR 462 (after tax refund etc). (ie. I received 462 less in that pay packet than normal after the 1000 was deducted for my bike).

I am on the higher rate of tax.

BUACHAILL

Quick question and sorry if its already been covered,

My sister is looking to do this scheme. She has recently been on maternity leave and as her salary has been less she has dropped back onto the lower rate of tax, however the higher rate will kick back in come Jan. There has been talk of the scheme being chopped come next budget so is eager to move.

Any idea how this will work, will she be done for lower rate or higher ? is it done on what your on when you take up the scheme or is it done an the annual basis ??

Beasty

BUACHAILL wrote: »

Any idea how this will work, will she be done for lower rate or higher ? is it done on what your on when you take up the scheme or is it done an the annual basis ??

It depends how the salary sacrifice is structured - if (as usual) over 12 months the deductions will come from pre-tax salary over each of those 12 months. If she takes it up in November for example, and the first deduction is in December, 1/12 would be in this tax year at the lower marginal rate and 11/12 would be in 2012 when her marginal rate would be higher

BUACHAILL

Beasty wrote: »

BUACHAILL wrote: »

Any idea how this will work, will she be done for lower rate or higher ? is it done on what your on when you take up the scheme or is it done an the annual basis ??

It depends how the salary sacrifice is structured - if (as usual) over 12 months the deductions will come from pre-tax salary over each of those 12 months. If she takes it up in November for example, and the first deduction is in December, 1/12 would be in this tax year at the lower marginal rate and 11/12 would be in 2012 when her marginal rate would be higher

Thanks for that Beasty was kinda Hoping it would be something like that !! I will let her know.

Any thoughts on what will happen the scheme in the dec budget ??

Beasty

BUACHAILL wrote: »

Any thoughts on what will happen the scheme in the dec budget ??

It was on the "hitlist" in the independent Taxation review published a year or two ago, but I can't see much sense in removing it for a number of reasons, including:

1. It costs very little to the taxpayer;
2. After the initial take-up there is bound to be a tailing-off, meaning the ongoing cost is reducing;
3. It encourages a healthy lifestyle; and
4. It's popular with a significant number of voters

Having said that given the current state of the public finances its removal could not be ruled out

Morf3h

seamus wrote: »

Uh, €250/month.

It comes out of your gross, so you should see a simple deduction in the payslip of €250. Don't bother trying to work out what it should be after tax, because it'll just melt your head.

So although it looks like I've paid 1000 I actually haven't because I pay less tax or something?

Beasty

Morf3h wrote: »

So although it looks like I've paid 1000 I actually haven't because I pay less tax or something?

In effect, yes

Toblerone1978

FYI, there is a well thought out and put together report recently done by the newly formed IBBA (Irish Bicycle Business Association) at www.ibba.ie.

Well worth a read for anyone with an interest in this kinda thing.

Apologies if this was already mentioned on the forum.

monument

Can an employer limit the amount an employee can spend to €500, rather than the standard €1,000?

Beasty

monument wrote: »

Can an employer limit the amount an employee can spend to €500, rather than the standard €1,000?

Yes - it's the employers scheme and they can put any limit they wish in

Interestingly though there is absolutely no benefit to them of doing this unless they are actually giving the bike to the employee (where clearly they then suffer the actual cost of the bike, which is a tax-exempt benefit to the employee)

If an employee gets a €1,000 bike the employer actually saves twice as much PRSI compared to getting a €500 bike under (typically used) salary sacrifice arrangements

jprboy

I didn't hear any proposals in the Budget to end the Bike to Work Scheme.

Is it likely that this will still be available in 2012?

Beasty

jprboy wrote: »

Is it likely that this will still be available in 2012?

Unless I've missed something, yes - I can't find any reference in any of the Budget documents published today

greenmat

Beasty wrote: »

Yes - it's the employers scheme and they can put any limit they wish in

Interestingly though there is absolutely no benefit to them of doing this unless they are actually giving the bike to the employee (where clearly they then suffer the actual cost of the bike, which is a tax-exempt benefit to the employee)

If an employee gets a €1,000 bike the employer actually saves twice as much PRSI compared to getting a €500 bike under (typically used) salary sacrifice arrangements

Sorry Beasty haven't read entire thread, but you said employer saves money on this scheme too, i.e. PRSI. Didn't know that. I thought they were doing me a big favour yet they save money too. In my job they make it so hard to apply and scheme only runs for a few weeks each year.

greened

Beasty wrote: »

Unless I've missed something, yes - I can't find any reference in any of the Budget documents published today

have been checking to and have not seen it mentioned anywhere.Took a gamle in Novemeber not to apply for the BTWS as I would have had to pay back in two pay cheques.

StaggerLee

I did thew bike to work last year, nothing showed up on any of my Tax documents in terms of credits claimed tec. Should they have?

seamus

StaggerLee wrote: »

I did thew bike to work last year, nothing showed up on any of my Tax documents in terms of credits claimed tec. Should they have?

Nope. All you should see is a reduction in your gross pay.

Slydice

is there a seperate thread anywhere for this scheme which discusses places to buy and combinations of bikes/gear that might be good for a commuter?

wobbles

Whats the average time for payment to go through after its been accepted, or does it vary company to company

buzz55

Hi,
I want to buy a bicycle under the bike to work scheme.

The bike I want is 1/2 the price online that I will pay in the local shop. Online is in the UK & the bike is on offer (it's 800 euro here, half that delivered from UK).

My question is, while I know that under the scheme the bike can be bought from anywhere (once my employer agrees), if the bike costs 400 euro delivered - can I then use some of the remaining 600 euro (up to the tax benefit amount of 1,000) to purchase some gear/equipment locally/from a different site?

I wouldn't mind giving some of my business locally but just can't justify twice the price, even with the tax benefits.

Does anyone know, or should I just get on to the revenue dept that deals with the scheme?

Thanks.

Lumen

Yes

Beasty

The money needs to be spent at pretty much the same time as there should only be a single salary sacrifice arrangement (which becomes a change to your contract of employment). I would imagine that if it was all done within the same pay period, with the salary sacrifice kicking in at the end of that or the following pay period it should be fine

buzz55

Thanks - that's made my day

Ah_go_on

Hi, has anyone bought a canyon online using the bike to work scheme (partially)? Looking at the ultimate slx which is the guts of €3k and want to use €1k from the btw scheme towards it. Any advice?

Idleater

Ah_go_on wrote: »

Hi, has anyone bought a canyon online using the bike to work scheme (partially)? Looking at the ultimate slx which is the guts of €3k and want to use €1k from the btw scheme towards it. Any advice?

As per the bike to work mega thread, there should be no problem but your employer will have to buy the bike ie all 3k. 1k will be taken from your gross, and 2k from the net, divided into whatever payment plan you agree to.
Personally speaking I saved my btw for a "cheaper " bike rather than my race bike because 500 saving on 1300 is more significant than 500 on 3000.

kenmc

Idleater wrote: »

Personally speaking I saved my btw for a "cheaper " bike rather than my race bike because 500 saving on 1300 is more significant than 500 on 3000.

how is it any different? surely you end up paying the same price for 2 bikes no matter which is the btw one?

Lumen

Depends on how handy your finance/accounting/HR people are, I guess.

It's a bit of a pain in the arse to administer these purchases, what with the combination of going over the 1k limit, the purchase being outside Ireland (VAT etc), dealing with Canyon and (possibly) the salary sacrifice arrangements.

Idleater

kenmc wrote: »

how is it any different? surely you end up paying the same price for 2 bikes no matter which is the btw one?

yes true I know that, I was only saying that saving 40% on a bike to cycle to work on for me was better than saving 10% on a race bike that I wouldn't/couldn't cycle to work on.

i.e. unless you are purchasing both bikes at exactly the same time, you can use the BTW scheme to get a more of better spec components, and buy the race bike at a different time negotiating whatever deals come about. In my case I got a 10% discount on the race bike which would have been the BTW money that couldn't have been applied if I went through the scheme (again, in my case).

Hungrycol

I was going to do this but didnt have the other €2k when push came to shove. What I was going to do was ask my finance dept to pay the €1k to Canyon and I'd settle the balance with Canyon directly.

Beasty

Threads merged

Beasty

joeduke

A person works for me earns €15 per hour before tax
He works 40 hours a week
He wants a bike, cost €1000
I pay for the bike
How do I get my money back?

Lumen

Take it out of his gross pay, usually in installments.

experimenter

Isn't there an on line tool for this??

http://www.cyclesuperstore.ie/shop/pc/bike2work.asp

joeduke

So I take €19.23 per week from his pay for 52 weeks

Lumen

joeduke wrote: »

So I take €19.23 per week from his pay for 52 weeks

From his gross pay, yes, if you want to spread it over 52 weeks. You can use whatever repayment plan you like, AFAIK.

He will see a lower reduction in his net pay.

joeduke

So if I take 52 x €19.23 = €1000 how is he saving?

Lumen

joeduke wrote: »

So if I take 52 x €19.23 = €1000 how is he saving?

Do you understand the difference between gross and net pay?

sbs2010

His weekly pay is 600, right?

Probably anything over 500 per week is getting hit with tax+prsi+usc of 50%.


Once he goes on to bike to work repayments, you take the 19 off the 600 before the tax etc is calculated, so thats 19.23 euro that he's not paying 50% tax+prsi+usc on. So its 9.62 tax he's avoided.

Instead of taking home say 380, he takes home 371.38

So over 52 weeks he's taken home 52x9.62 less than he would have. Thats 500 less pay he's taken home but he's got a bike for 1000.

WilcoYHF

Hi all,

I work for a very large UK engineering company and I'm pretty desperate to get on the bike to work scheme (I did my first 100k yesterday on my rubbish halfords hybrid in 5 hours and its gotta go). Unfortunately anytime I ring the HR dept based in the ring UK no one seems to know whether the company does the scheme for ROI employees (well one girl said I could get on it but when I said "you do know we're in a different tax jurisdiction in Dublin" to which she said "oh yeah, no we don't do it in Eire). When I do get a definitive answer that I can't get on it, I always feel that they actually don't know.


So my query is, has anyone else been in this situation, is there anything I can do??

Beasty

There's nothing to stop them offering the scheme to all employees who are subject to Irish PAYE, but there's nothing to force them either

One point to clarify - do you work for a UK company (which would be in effect an Irish branch of the UK company), or do you work for an Irish subsidiary of a UK company? It does not affect the overall conclusion, but I suspect that putting in place a scheme for an Irish company may be a little easier than for an Irish branch (more in terms of internal company procedures than the technicalities)

Iwernia

joeduke wrote: »

So I take €19.23 per week from his pay for 52 weeks

You decide the term, my last employer wanted repayment over 3 months whereas my current employers scheme is over 6 months.

WilcoYHF

Beasty wrote: »

There's nothing to stop them offering the scheme to all employees who are subject to Irish PAYE, but there's nothing to force them either

One point to clarify - do you work for a UK company (which would be in effect an Irish branch of the UK company), or do you work for an Irish subsidiary of a UK company? It does not affect the overall conclusion, but I suspect that putting in place a scheme for an Irish company may be a little easier than for an Irish branch (more in terms of internal company procedures than the technicalities)

Its a UK company of which we are an Irish branch, therefore all HR, accounts etc are in the UK hence the hassle. There is one guy who does our wages I'm goona try talk to him directly after that I'm at a loss.

Surveyor11

I work for a company in Ireland who has a UK head office. They use http://www.cyclescheme.co.uk/, who basically act as an agent. They seemed to be up to speed with the Irish system, which is pretty identical - you just pick a bike, get an invoice for it, the company gives you a loan and recoups the amount net of tax from your monthly wage.

Beasty

Surveyor11 wrote: »

They seemed to be up to speed with the Irish system, which is pretty identical

The UK and Irish schemes are very different. In particular in the UK scheme the employer retains ownership of the bike

Surveyor11

Ok, fair enough - that's a point. But the admin end of things and tax relief AFAIK is pretty similar.

Beasty

Surveyor11 wrote: »

Ok, fair enough - that's a point. But the admin end of things and tax relief AFAIK is pretty similar.

The Irish scheme is both simpler and probably a bit more generous (even though the financial limit is lower at €1k compared to £1k, under the UK scheme the employee would still need to pay market value to purchase the bike at the end of the scheme). Unfortunately however the rules are actually quite different, which makes the admin of running both schemes a bit more cumbersome

cL0h

Beasty wrote: »

The UK and Irish schemes are very different. In particular in the UK scheme the employer retains ownership of the bike

Has anyone here actually purchased a bike from the UK under the Irish scheme. I am talking to both Wiggle and my employer at the moment.
My employer reckons that Wiggle need to be signed up to the IRish scheme. The OPW reckons they are but can anyone confirm the process is as straightforward as requesting an invoice and having my employer pay it.