Should we be pushing for greater fairness in C2W?

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 7 Oct 2019, 9:39am

brynpoeth wrote:It is just like the scrapping credit for cars, moves cash, creates work, uses resources
-1

Why would anyone want more than one cycle? :wink:

Different cycling duties, different needs from bikes means more than one bike and generally new "bright and shiny" toy effect for big boys and girls. Add in the fact you're stiffing the state for 41% of the cost as a higher rate tax earner there's a very good reason. :wink:

I have kept all my bikes bought since I was 17 (all the ones I've paid for myself). Except for the stolen one. One is kept for sentimental reasons but needs to be made roadworthy before riding. The other gets road and off road use despite being a commuter road bike. The third is my sh recumbent that will likely cost me only maintenance costs once I decide to sell it on. Either way those bikes have probably saved more in emissions reduced than they cost to make by the time they end their lives.

If only people could say that about their cars and rampant consumerist purchases!

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 7 Oct 2019, 9:42am

Why should it be done through purely tax regime? Why not give straight discount for bikes and limit it? Why use tax thresholds? Why just bikes? Why not the Scandinavian system? That is totally fair and honest.

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TrevA
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Re: Should we be pushing for greater fairness in C2W?

Postby TrevA » 7 Oct 2019, 9:43am

The C2W scheme is flawed in several ways.

It should be available to all taxpayers, regardless of whether your employer has signed up for it.

It’s not available to those who don’t work. I’ve retired, I still pay tax and I’m riding my bike more than ever I did whilst I was at work, so why can’t I enjoy the savings from the scheme?
It could be argued that the unemployed need it even more than those who work.

Why £1000 limit? It’s been at that level since it was set up, that’s well over 10 years ago. It should have gone up to take account of inflation, and why is there a limit in the first place? If you can afford the repayments you should be able to spend more than that amount.
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reohn2
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Re: Should we be pushing for greater fairness in C2W?

Postby reohn2 » 7 Oct 2019, 9:44am

Tangled Metal wrote: ....So level the playing field. Why not give everyone the same discount?......

If you're trying to encourage cycling it seems that would be a logical step forward.
In the Netherlands anyone can walk into any bike shop fill in the form show their ID card and walk out with a bike the cost of which is deducted from the salary at source over 3years tax free with no interest and no strings attached(this was last time I looked a few years ago).
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PH
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Re: Should we be pushing for greater fairness in C2W?

Postby PH » 7 Oct 2019, 9:57am

TrevA wrote:Why £1000 limit? It’s been at that level since it was set up, that’s well over 10 years ago.

The limit has now been removed, mainly to enable the purchase of E-bikes, though there's no distinction within the scheme.

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Re: Should we be pushing for greater fairness in C2W?

Postby PH » 7 Oct 2019, 10:00am

Tangled Metal wrote:Why should it be done through purely tax regime? Why not give straight discount for bikes and limit it? Why use tax thresholds? Why just bikes? Why not the Scandinavian system? That is totally fair and honest.

The government like it that way, it costs them next to nothing, the employer is providing the loan and the scheme providers are taking on the admin. It makes it look like they're doing something, for very little effort.

mattsccm
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Re: Should we be pushing for greater fairness in C2W?

Postby mattsccm » 18 Oct 2019, 8:16pm

Fairness is treating everyone the same, not penalising them because they are luckier or capitalising on this luck.

Syd
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Re: Should we be pushing for greater fairness in C2W?

Postby Syd » 18 Oct 2019, 8:43pm

mattsccm wrote:Fairness is treating everyone the same, not penalising them because they are luckier or capitalising on this luck.

How are you defining luck?

mattsccm
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Re: Should we be pushing for greater fairness in C2W?

Postby mattsccm » 19 Oct 2019, 10:25am

Anything that is not planned.

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 20 Oct 2019, 10:17pm

TrevA wrote:The C2W scheme is flawed in several ways.

It should be available to all taxpayers, regardless of whether your employer has signed up for it.

It’s not available to those who don’t work. I’ve retired, I still pay tax and I’m riding my bike more than ever I did whilst I was at work, so why can’t I enjoy the savings from the scheme?
It could be argued that the unemployed need it even more than those who work.

Why £1000 limit? It’s been at that level since it was set up, that’s well over 10 years ago. It should have gone up to take account of inflation, and why is there a limit in the first place? If you can afford the repayments you should be able to spend more than that amount.

Clue is in the name. Cycle to work. AIUI the scheme is supposed to be based on at least half the journeys made with the bike being to or from work. As in reduce car use for commuting and encouraging healthier modes of transport to work.

Doing anything else makes it simply a tax break I guess.

awavey
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Re: Should we be pushing for greater fairness in C2W?

Postby awavey » 20 Oct 2019, 11:42pm

TrevA wrote:The C2W scheme is flawed in several ways.

It should be available to all taxpayers, regardless of whether your employer has signed up for it.

It’s not available to those who don’t work. I’ve retired, I still pay tax and I’m riding my bike more than ever I did whilst I was at work, so why can’t I enjoy the savings from the scheme?
It could be argued that the unemployed need it even more than those who work.

Why £1000 limit? It’s been at that level since it was set up, that’s well over 10 years ago. It should have gone up to take account of inflation, and why is there a limit in the first place? If you can afford the repayments you should be able to spend more than that amount.


well what savings do you think the scheme actually provides ? the bikes you buy on C2W are going to be sold at RRP, I guarantee you can walk into any LBS with an equivalent amount of cash in your pocket, and you will be able to walk out with an identical bike with a much bigger saving off RRP than anything C2W gets you.

All C2W really gives you is a 12month interest free loan, which isnt to be sniffed at, but its not getting people discounted bikes and there are cheaper ways to purchase bikes

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 21 Oct 2019, 12:06am

Local bike shop gives up to 36 month interest free loan via V12 (possibly the most used credit company by such shops) and they'll allow it on anything costing £799 or more. Add to that they'll allow it on discounted bikes such as outgoing year's bikes that get a big discount every September or so. IIRC the genesis TdF costing £1200 new was going for £860 28% saving with 36 months interest free.

Now if you're on the lower tax rate you've saved there and still have 3x the interest free period to boot. Higher tax rate you're going to save more on full list price of £1200. But that's based on only 12 months interest free and a fair market value of 25% of full value at the end of 12 months or £300. So by my reckoning if the company follows HMRC guidance for fair market value you'd probably be better buying it over 3 years interest free off the discounted price.

Imho I think it really only benefits the highest tax rate employees. However salary sacrifice can also affect pension I believe. Whether that makes it less of a benefit I don't know enough to say.

landsurfer
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Re: Should we be pushing for greater fairness in C2W?

Postby landsurfer » 21 Oct 2019, 6:43am

There is no such thing as an interest free loan.
The costs, interest and capital are loaded onto the price of the product and fees and commissions are paid to the loan provider and the retailer .... otherwise why would a company provide finance without return ? .. :roll:

TANSTAAFL applies.
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Syd
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Re: Should we be pushing for greater fairness in C2W?

Postby Syd » 21 Oct 2019, 7:25am

Tangled Metal wrote:Imho I think it really only benefits the highest tax rate employees. However salary sacrifice can also affect pension I believe. Whether that makes it less of a benefit I don't know enough to say.

Any salary sacrifice scheme can have an impact on pension. If so and by how much depends on a number of factors.

In my case I calculated by C2W payments will reduce my pension by around 90p per year.

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 21 Oct 2019, 8:26am

landsurfer wrote:There is no such thing as an interest free loan.
The costs, interest and capital are loaded onto the price of the product and fees and commissions are paid to the loan provider and the retailer .... otherwise why would a company provide finance without return ? .. :roll:

TANSTAAFL applies.

Of course not, but having looked at the small print those are effectively being covered by the retailer taking a hit. For example a £720 bike deal paid for over 24 months costs £30 for 24 payments without setting up charges, completion charges or interest. No hidden surprises in the small print. Asked the manager outright and got it spelt out clearly. They divide total amount by number of months your want the loan period to be subject to a very modest limit for 3 years. They adjust monthly payments to give a whole number in pence then adjust on the last payment.

I've seen other retailers do similar but with different loan value limits. A few do pass on fees to the purchaser but not all do. I'm very sceptical about something for nothing so I checked in this case. As a bike retailer wheelbase is imho one of the best localish to me. So much so that I travel about 40 minutes to buy from them and to get work done on our bikes. Their mechanics are good and very reasonable. Only bike shop other than the fort William one we used on holiday once that I trust the quality of their work. Bike prices in the sales aren't bad at times too.