Access Accounting has always been keen to promote cycling to work. We have around a dozen staff that use their cycles - including three directors of the company. Over a period of time we've provided shower facilities, and a secure bike lock-up (AKA a big shed with a combination lock!).
When a member of staff suggested that we look at a Revenue scheme where we can provide bikes - and the staff would get a tax benefit - we were very interested. The essence of the scheme appeared to be that the company would fund the purchase of the new bikes and then deduct monthly payments from the staff who use them. The purported benefit is that these deductions from salary would be made before tax. Great - we thought ! But, like all good Government schemes - they are always more complicated than first thought.
These complications included that we would have to be licensed for credit, we would need to apply for a "Salary Sacrifice" scheme, and each employee would have to declare that their use of their bike to work represented more than 50% of it's use. We could, at a push, still handle all of that administrative overhead but the biggest dis-incentive was yet to come.
The scheme is based on a strict credit leasing agreement. This means that at the end of the period our employee would have to give the bike back to us, and we could then dispose of it at current market value. The employee would not get any recognition of the monthly charges that they had made. This killed the adoption of the scheme dead in its tracks. What employee would want to select their chosen machine, pay for it over 24 months, and not have any option of ownership at anything less than second hand market value. Similarly we, as a company, did not fancy entering the second hand bike market. This appears to be another example of the Government trying to play the "Green" card without serious intent.
Kevin Misselbrook
Comments