Who do I contact with queries?
Sonia Atkins is the contact for any general queries. 01785 276615; or email email@example.com
Shared Service Contact is 01785 276112; e-mail firstname.lastname@example.org
Alternatively please contact Cyclescheme on 01225 448933, quoting ref. a519e7; or email email@example.com
Below is a selection of Frequently Asked Questions relating to Cycle Scheme
Does my employer need a Consumer Credit Licence?
The government has issued a blanket consumer credit licence to all participating employers to purchase bike packages up to £1,000 including VAT and safety equipment. When you sign the Hire Agreement, the resulting relationship is defined under the terms and conditions of the Credit Consumer Act.
Can I use Cyclescheme to get a sale bike?
Yes, but this is subject to the bike shop's discretion. You must mention Cyclescheme when obtaining a quote for your bike and safety equipment.
Fair market value
What is the fair market value payment?
HMRC's definition of market value 'The market value of an asset at a particular time is defined (Section 208 ITEPA 2003) as the price that it might reasonably have been expected to fetch on a sale in the open market at that time.'
After a period of 12 months, this is typically defined as 18% for bikes upto £500 and 25% over £500 upto £1000. Fair market value of 5% + VAT will be deducted in the 13th month. The difference between this figure and the 18 or 25% will be added to the employees P11D as a balance in benefit in kind.
When do I pay the fair market value to make the bike mine?
At the end of the 12-month hire period a 13th payment, the fair market value, will be calculated and 5% + VAT will be deducted automatically from your salary unless SSC are informed otherwise. The difference upto 18 or 25% will be added to the employees P11D (Refer to "How cycle scheme works"). This is a separate agreement and does not form part of the Hire Agreement.
What happens if I leave my job before I've finished paying for my bike?
Under the terms of the Hire Agreement and the Credit Consumer Act, the agreement to pay your employees' loan is non-cancellable. This means that you would need to settle all outstanding monies should you leave SCC before the end of the Hire Agreement. The outstanding balance will be deducted from your final net salary payment. Settlement will be from net pay because once you leave Staffordshire County Council you also leave the Cycle Scheme, and are no longer eligible for tax/NI concessions. For those leaving before the end of the Hire Agreement period a termination fee will be charged. The termination fee will not exceed a value equal to the outstanding monthly salary reductions but may also include a sum equating to the fair market value at the time of termination (to transfer ownership of the bike to the employee).
What happens if the bike gets lost / stolen before I've paid for it?
If the bike is stolen then you will be required to continue to meet your financial responsibilities for the remainder of the hire period. The insurance that you will have purchased for the bike can then be used to provide a replacement. Safety equipment is available from Cyclescheme Ltd's partner shops, where you can ask for Home Office-approved 'Sold Secure' D-locks and cable locks to conform to insurance companies' requirements.
What happens if I don't want the bike at the end of the hire period?
It is SCC's choice whether it opts to sell you the bike at the end of the hire period. If you choose to become the owner of the bike, a 13th payment of 5% + VAT of the fair market value, will be deducted automatically from your salary. The balance of up to 18 or 25% will be added to the employees P11D. Refer to "How cycle sheme works". If you choose not to buy the bike then you must return the bike to Sonia Atkins, 01785 276615 and SCC will keep ownership.
How many times a week do I have to use the bike for work?
A bike purchased under Cycle Scheme should be used for at least 50% of the total time used, for travelling to work. There is however no requirement for you to cycle to work for a specified number of days throughout the year to be eligible to participate in the scheme and there is no special requirement for you to record your travel. You can also use the bike for leisure at weekends and on holiday.
Can I use the bike for business purposes during the working day?
Yes, you can use your bike for business purposes during the working day, although you may not claim expenses for business trips made on a bike obtained through this scheme until the hire period ends. Employees should ensure they are covered for third party, personal accident and theft during these trips.
Effects of salary sacrifice
I receive out of hours payments on top of my basic salary: will these be affected?
No. In calculating all other payments to you such as out of hours payments, your total unreduced pay will be used.
What happens when there is a pay award?
You will receive any relevant pay awards based on your unreduced salary.
Will the repayments affect student loan payments?
Yes. Your student loan repayment is 9% of your earnings over £15k. This will alter as the trigger point is based on the salary on which you are liable to pay National Insurance Contributions (NICS). Under salary sacrifice your total gross salary on which NI is paid will reduce, so your loan repayments will reduce.
How will this affect my credit status, e.g. when applying for a mortgage?
By entering into the scheme you agree to forfeit part of your salary and this may have an impact when SCC reply to credit reference checks on your behalf. SCC will quote the pre sacrifice amount and will also quote the post sacrifice amount. It is up to providers to determine which salary they will use for their calculations. Please make enquiries with your financial institution regarding what their processes are in these instances.
Does anyone need to tell HMRC about this benefit?
The Cycle Scheme is a government-sponsored initiative that has been set up so that you do not have to pay tax and NI on items bought under the agreement. There is no need for you to contact HMRC about participation in the scheme. We will notify HMRC via a P11D of any benefit in kind. You may need to include this if you complete a self assessment form.
What happens if someone changes their mind after joining the scheme?
You will be committed to the full duration of the agreement and as such will be unable to cancel the agreement early. This is due to the unique terms of the scheme. As mentioned above, if your employment is terminated, by either yourself or your employer, you will be required to settle all outstanding monies before you leave.
Back to top