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

MJohnston

UrbanFret wrote: »

5 months back a Carrera Vengeance e bike retailed at €958 todays price €1,315.00.
Anything to do with the higher subsidy I wonder.:mad:

More likely Covid bike demand.

grogi

MJohnston wrote: »

More likely Covid bike demand.

And supply shortages.

byrnem31

Im not eligible until 3 years on the old scheme. Does this mean I will be eligible in 2 or is it only for new entrants to the scheme ?

MJohnston

byrnem31 wrote: »

Im not eligible until 3 years on the old scheme. Does this mean I will be eligible in 2 or is it only for new entrants to the scheme ?

Yes.

And you don't need to wait until exactly 4 years, it's January of the 4th year. So if you bought something on Cycle to Work this December, you'd be eligible for another purchase by January 2024.

Away With The Fairies

Can someone explain this whole scheme to me? Do I get any other benefit from this scheme?

As far as I know, deductions are made from my wages over 3 months. But looking at a bike that cost 1200, that's a 100 deduction per week which I really can't afford.

Is there anything else to this whole scheme that might bring down the cost for me?

Maidhci

Read posts 1 - 5 of this thread!

Idleater

Away With The Fairies wrote: »

Can someone explain this whole scheme to me?

Beasty wrote: »

In summary:

Basically, you can get up to €1,000 of bike/accessories through your employer, either as a completely free benefit-in-kind (if your employer likes you); or paid for by deductions from your salary, saving you tax, PRSI and levies on the purchase price. There is a benefit to the employer as they save employers PRSI.

• There is no obligation on your employer to operate it.
• Your employer does not have to notify Revenue that they will operate the scheme, although they may be subject to Revenue audit on the operation of the scheme.
• The scheme is only available to employees and company directors. The self-employed cannot avail of the scheme, as you must be on PAYE (employees of the self-employed can qualify). It must be available to all PAYE employees/directors of the company – it cannot be restricted to particular categories of staff or individuals
• It's €1,000 every 5 years.
• The bike must be bought by the employer, a receipt by the employee for a refund is not acceptable.
• The bike can be purchased anywhere and not confined to Ireland.
• Your employer should get you to sign a statement saying that you will use the bike primarily for commuting to work. Commuting to a train station, Luas or bus stop is OK.
• There is no minimum days that you must commute to work on the bike.

It can be a used as a salary sacrifice from your gross pay over a period of no greater than one year.
Alternatively is can be used as a tax free benefit (gift) to the employee.
It does not include a replacement bike if you crash or if your bike is stolen.
If you spend only, say, €600 on the bike in the scheme then you're done, i.e. you cannot claim the additional €400 at any time within the 5 years. However if you claim €1,200 on the scheme the first €1000 is tax free and the balance is taxable (or deductible from your net pay).
The Revenue have issued a set of FAQs on the scheme which can be seen here

Away With The Fairies wrote: »

Is there anything else to this whole scheme that might bring down the cost for me?

You save on expenses for whatever transportation method you otherwise would use.

cletus

Away With The Fairies wrote: »

Can someone explain this whole scheme to me? Do I get any other benefit from this scheme?

As far as I know, deductions are made from my wages over 3 months. But looking at a bike that cost 1200, that's a 100 deduction per week which I really can't afford.

Is there anything else to this whole scheme that might bring down the cost for me?

Are you in the public sector? I'm a teacher, and our scheme is in operation from January to November. So if I were to buy a bike now, I'd end up paying the cost back over 3 months. If I waited till January, I'd pay the cost over 11 months.

Also, even though you're paying, say, €100 a week for the three months, that money is taken from your account before tax, so the net amount deducted from your wages will be less, how much depends on your current tax bracket

Officer Giggles

is there any sign of a start date for the amendments to the scheme

MojoMaker

Local bike shop mentioned September 1st 2020 to me yesterday.

Chiparus

I want to order a van moof , they only operate online, but as I read it, I have to get my employer to pay Van Moof.

Or can I present the paid invoice to my employer (HSE) and they pay me back ?

Sorry if this has already been answered in the previous 2000 or so posts.

magicbastarder

no, your employer has to pay them directly, otherwise it gets messy - you'd be paying €1000 out of your already taxed pay, and they'd have to refund you your post tax benefit (say €520), dock your pay by the actual €1000, etc.

Chiparus

Thanks, it is a pity, In Australia, we could just submit things like our rent receipt and it was salary sacrificed.

engineer0

I have seen a few posts asking about how to get a Canyon Bike, using bike to work scheme. Canyon provided the following details to me,
FYI

In order to use the Cycle to Work scheme in Ireland you need to purchase the bike as normal on www.canyon.com. Then on the checkout make sure that the company name is listed as the billing address.
The Irish Cycle to work scheme does not require a specific form or process, all you need to do is to simply order the bike, making sure that the customer name and address are filled in with the details of the company who is buying the bike.
Then select Pre-Payment as the payment method then an invoice will be generated and sent to you by email. Please then pass the invoice to the HR department of your company for payment.
Your HR will be able to reimburse the VAT, all they need are the registered details of Canyon in Ireland:
Member State: IE
VAT Number: IE 9685412C
Name: CANYON BICYCLES GMBH
Address: KARL - TESCHE -STR 12 ,D-56073 KOBLENZ ,GERMANY

magicbastarder

the issue with canyon is not that they won't engage with the scheme, per se, but that they won't split an invoice if the purchase exceeds the threshold (currently €1k)

iwillhtfu

The issue isn't with canyon its possibly with your finance dept. Canyon simply ask a bill to be paid in full by one method and I dont think that's any different to any other shop. I've used the bike tonwork with them before and there was no issue but you need to engage your finance dept to pass on the invoice and arrange excess deduction from your payroll.

grogi

engineer0 wrote: »

I have seen a few posts asking about how to get a Canyon Bike, using bike to work scheme. Canyon provided the following details to me,
FYI

In order to use the Cycle to Work scheme in Ireland you need to purchase the bike as normal on www.canyon.com. Then on the checkout make sure that the company name is listed as the billing address.
The Irish Cycle to work scheme does not require a specific form or process, all you need to do is to simply order the bike, making sure that the customer name and address are filled in with the details of the company who is buying the bike.
Then select Pre-Payment as the payment method then an invoice will be generated and sent to you by email. Please then pass the invoice to the HR department of your company for payment.
Your HR will be able to reimburse the VAT, all they need are the registered details of Canyon in Ireland:
Member State: IE
VAT Number: IE 9685412C
Name: CANYON BICYCLES GMBH
Address: KARL - TESCHE -STR 12 ,D-56073 KOBLENZ ,GERMANY

That VAT story is a bit dodgy. The employer should not claim the VAT back on this purchase, as the bike is not theirs to keep. They would need to pay the VAT at the moment of the transfer of the ownership to you.

iwillhtfu

grogi wrote: »

That VAT story is a bit dodgy. The employer should not claim the VAT back on this purchase, as the bike is not theirs to keep. They would need to pay the VAT at the moment of the transfer of the ownership to you.

They're clearly misinterpreting where the discount is applied. Why would they be bothered reading up on all the bike to work schemes it's none of their business, they sell bikes.

MojoMaker

Yeah, I think the VAT element is a red herring here.

dinneenp

magicbastarder wrote: »

the issue with canyon is not that they won't engage with the scheme, per se, but that they won't split an invoice if the purchase exceeds the threshold (currently €1k)

I bought from them, 2 months ago, over €1k. I simply paid the excess myself.

magicbastarder

cool, sounds like they've changed that policy so.

bilasy

Sorry for the basic question, if the bike costs €1500 and the employers gets back €1500 from my salary sacrifice over the 12 month where are the savings, I’m on the higher tax
Thanks

Officer Giggles

bilasy wrote: »

Sorry for the basic question, if the bike costs €1500 and the employers gets back €1500 from my salary sacrifice over the 12 month where are the savings, I’m on the higher tax
Thanks

If the bike costs €1500, €1000 is repaid via salary sacrifice and you pay the other 500 upfront, the €1000 is taken from your pre-tax income therefore you don't pay tax on that income, in reality the €1000 pay back only took €520 out of your pocket, the €480 saving is from not having to pay tax on the €1000 you earned

cython

Officer Giggles wrote: »

If the bike costs €1500, €1000 is repaid via salary sacrifice and you pay the other 500 upfront, the €1000 is taken from your pre-tax income therefore you don't pay tax on that income, in reality the €1000 pay back only took €520 out of your pocket, the €480 saving is from not having to pay tax on the €1000 you earned

Other way around surely (once you're talking the higher rate)? Of that 1000, the employee would have paid 52% or 520 in tax, and only gotten 480 into their pocket?

magicbastarder

in order to benefit from the ful €1.5k, you'll need to be buying an e-bike on the new thresholds (whenever they are introduced).
at the moment, the limit you can benefit from is €1k, and the extra €500k comes out of your own pocket (and does not benefit from any tax efficiencies).

bilasy

Officer Giggles wrote: »

If the bike costs €1500, €1000 is repaid via salary sacrifice and you pay the other 500 upfront, the €1000 is taken from your pre-tax income therefore you don't pay tax on that income, in reality the €1000 pay back only took €520 out of your pocket, the €480 saving is from not having to pay tax on the €1000 you earned

Assuming the changes takes place in September and I submit my quote to avail of the €1500, the employer rules is that I have to repay the €1500 before 31/12/20, which option is more beneficial paying €250 every forthright ( as the amount I don’t pay tax on is higher) or just wait till January and split the payment over 12 months?

Idleater

bilasy wrote: »

which option is more beneficial

Depends on what you define as beneficial. You won't pay more or save more either way, but it will be over and done with quickly or slower with different amount per interval.
Also do you want to have use of the bike in 2020 or only from 2021?

bilasy

Idleater wrote: »

Depends on what you define as beneficial. You won't pay more or save more either way, but it will be over and done with quickly or slower with different amount per interval.
Also do you want to have use of the bike in 2020 or only from 2021?

If there is no difference I’d rather get the bike in January and make the payment over 12 months.

Idleater

bilasy wrote: »

If there is no difference I’d rather get the bike in January and make the payment over 12 months.

It's basically a 0% interest loan to you from your employer with payments taken from your gross pay, if you leave the job the remainder will be lumped together.

CramCycle

bilasy wrote: »

If there is no difference I’d rather get the bike in January and make the payment over 12 months.

Depending on the employer, it probably makes no difference when you get it, as most (not all) pay back over 12 months, I would do it as soon as the limit goes up to 1250 if they do it over 12 months. Rumour has it that will come in this September.