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Why do you only offer Halfords bikes?
Why should I use Bikescheme - can’t I just go direct to a supplier?
What’s the benefit for employees?
Is there a minimum order size?
What's in it for our company?
How much work is involved for my HR?
What else do we need to do?
How much can my employees have?
Can we go higher than £1000?
Can employees add some of their own money to the voucher to obtain a higher value bike?
Can someone have more than one bike?
How long does it take to set up a scheme?
How long does it take to get a bike?
Which of my employees are eligible?
Can the directors have better or more equipment?
What constitutes having mainly used the equipment for cycling to work?
How do I reclaim VAT on the scheme?
Do I need OFT approval?
Is there anything else I should do?
Do I need a Consumer Credit Licence to run a scheme?
How long should my scheme be open to my employees?
Can an employee enter into more than one Hire Agreement concurrently?
Do I have to be a director to run the scheme?
Who owns the equipment?
What happens at the end of the scheme?
What if an employee leaves early or is made redundant?
Who is responsible if the equipment is lost or stolen?
Can you come and visit my company?
We would like to fund the scheme ourselves, can this be done?
What documentation is there to sign?
Why do you only offer Halfords
bikes?
We are proud to work in conjunction with Halfords As we believe that Halfords have the most robust and compliant scheme in the market, coupled with an unbeatable buying power, excellent customer service and warranties. They have over 435 stores nationwide, and their ranges of bikes are constantly being added to. Fulfilment of orders are through letters of collection, (your employees do not have to take a day off to wait for a delivery company to arrive). By using Halfords, you have the peace of mind that your employees will be getting a bike direct from the store, all fully built, assembled and checked, ready to ride away, thus limiting any potential liability. With Halfords huge buying power, they are able to offer superb bikes which offer unequalled levels of specification and build quality at prices which are difficult to match. Bikescheme uses the Halfords Cycle2Work scheme and its documentation, as we know that they are compliant with the legislation and guidance (from HMRC and the Department for Transport) and they ensure the scheme reflects its overall intent and spirit.
Why should I use Bikescheme - can’t I just go
direct to a supplier?
Many cycle to work providers are not interested in companies with less than several hundred employees. Team Rewards have used their expertise in administering Cycle2Work schemes on behalf of Halfords, and harnessed with their experience of running a range of employee benefit initiatives, they have created the runabikescheme and bikescheme portals- sophisticated yet simple to use portals that take care of all of the hard work. Team Rewards will hand hold you throughout the process and provide you with two dedicated helplines for you and your employees. Our proven formula will ensure that when you run a cycle to work scheme, it will have a successful outcome for all concerned, and will be fully compliant with OFT and HMRC regulations. All of the services within runabikescheme and bikescheme are free of charge.
What’s the benefit for employees?
It's not hard to see what's in it for the employee; the opportunity
to obtain a brand new bicycle and cycling safety equipment with
savings of up to 50%
Is there a minimum order size?
No.
What's in it for our company?
Bikescheme has a range of benefits for you as an employer,
including:
• National Insurance Contributions savings
• Higher levels of staff morale
• Increased productivity
• Increased employee health and wellbeing
• Contribution towards an environmental policy
• Helps to achieve a Green Transport Plan
• Frees up valuable Car Parking Spaces
• A simple scheme to run, all the documentation is in
place and it is compliant with the latest legislation.
How much work is involved
for my HR?
We have developed runabikescheme to make it as simple as possible
to run the scheme. A scheme can be set up on the portal in
a few minutes. We suggest you appoint one person in your HR
responsible for checking the eligibility of employees against
the eligibility criteria. You will have access to your company and employee’s
data 24/7, so the minimal administration time can be fitted
to suit you. All employees questions can be answered by our
helpline, (we also answer email enquiries), so once set up,
your time is kept to a minimum.
What else do we need to
do?
You will need to make sure that your payroll system has the
capability to reduce an employee’s gross pay prior to
calculating the Tax and NI deductions.
How much can my employees
have?
The minimum that an employee can choose is £100 and
the maximum is £1000. You can narrow the choices for
your employees if you wish, but we would recommend that you
go with the £100 - £1000 range.
Can we go higher than £1000?
The ethos behind this initiative is to encourage car drivers
to switch to cycling to work. The government has set the limit
to £1000 for this tax efficient initiative.
Can employees add some
of their own money to the voucher to obtain a higher value
bike?
No. The Department for Transport have issued guidelines that
state that employees cannot do this. We have made the LoCs
available in £10 increments, so that employees can select
a value close to the value of the bike and safety accessories.
Can someone have more than
one bike?
Yes, provided that both add up to no more than £1000
and that both bikes are used for journeys to or from work.
For example, one bike could be from home to the train station
and left there, and the second bike could be used for the
journey from the destination train station to work and back.
Alternatively, an employee may choose to have a summer bike
and a winter bike.
How long does it take to set up a scheme?
Once you have applied, you can be setting up a scheme within a couple of days. Credit checks are made on the company and you will need to download and post original signed copies of the supplier agreement. Once these are in place the scheme can launch.
How long does it take to get a bike?
This depends on the length of the election window you choose, and also on the funding route. If you choose to self fund and your company receives a favourable credit check for opening a 30 day account with Halfords, then as soon as the election window is closed, approved orders are visible to Halfords. LoCs are sent out within 5 working days of this point. If a credit check is not favourable, you will be asked to pay pro-forma. In other words, once the scheme has closed, Halfords will invoice your company for the bikes, and will not release LoCs until they have received cleared funds. For this reason we recommend that you pay by Bacs transfer rather than cheque as it is quicker to clear. If you have chosen 3rd Party funding, then once the scheme has closed you will be sent lease documents and an invoice for the first month’s payment. Once these signed documents and a cheque have been received, then Halfords are notified, and the LoCs are sent out within 5 working days.
Which of my employees are
eligible?
When running a cycle to work scheme it is important that you do not discriminate on any grounds, and so for example, you cannot offer the scheme to directors only or on favourable terms to them. Employees on or near the National Minimum Wage are not able to participate in the scheme because the salary sacrifice would take their salary below the legal national minimum wage. If you have employees on or near the National Minimum Wage we advise that you seek HMRC clarification prior to setting up a scheme
Can the directors have
better or more equipment?
No. Under the bikescheme rules directors cannot be offered
the scheme on preferential terms.
What constitutes having
mainly used the equipment for cycling to work?
The equipment should be predominantly used for commuting purposes,
which includes journeys made between the employee's home and
the workplace, or part journeys (for example, to the station),
or for between one workplace and another. Provided the equipment
is used predominantly for commuting purposes, then it can
also be used during leisure time too. There is no set criteria,
which can be used by the employee to confirm they have satisfied
the "mainly for work" requirement, such as frequency
of use, miles travelled, or hours spent cycling. Employees
are not expected to keep mileage logs but employers should
make clear to them that if they do not use the cycle mainly
for qualifying journeys, they may lose the benefit of the
tax exemption. The Hire Agreement provided for participating
staff through this scheme, which is signed by the employee,
outlines this requirement, ensuring the employee is aware
of their responsibilities
How do I reclaim VAT on
the scheme?
Bicycle and Cycling Safety Equipment obtained under the bikescheme is to be mainly used for cycling to work by employees. As
the equipment is for use in a cycle to work scheme for employees,
HMRC accept that the VAT incurred is for the purpose of the
employer's business and is therefore subject to the usual
rules on VAT recovery. The benefits to a business are seen
as attracting, retaining and motivating employees and promoting
a healthier workforce. Some businesses are partially exempt
from input tax and so their ability to reclaim VAT may be
restricted. If in doubt, contact your local VAT office.
Do I need OFT approval?
No
Is there anything else
I should do?
Yes, you need to write to your HMRC office and inform them
you are running a cycle to work scheme.
Do I need a Consumer Credit
Licence to run a scheme?
The Office of Fair Trading (OFT) has issued a group licence
which authorises all employers to run cycle to work schemes
without each employer applying for an individual licence.
You can download
a copy of the licence here if you wish.
How long should my scheme
be open to my employees?
The delivery of the Letter of Collection to your employees
will not begin until the live scheme and documentation phases
have closed, so it makes sense to restrict the length of time
the scheme is live. Our recommendation is 2 - 3 weeks.
Can an employee enter into
more than one Hire Agreement concurrently?
An employee can have more than one Hire Agreement for bikescheme with you at a time. However you must make sure that any combination
of Hire Agreements does not take the employee below the National
Minimum Wage, and the total values do not exceed £1000
Do I have to be a director
to run the scheme?
No. Anyone in an organisation can promote and manage the process.
An authorised representative must sign Halfords' Supplier
Agreement and sign any leasing documents.
Who owns the equipment?
The employer company/leasing company owns the equipment. The legislation that
governs cycle to work schemes quite specifically forbids the
employee to own the equipment - and therefore there can be
no automatic right for the employee to own the equipment at
the end of the Agreement. If they do, they cannot claim the
tax exemption. Therefore bikeschemes operate as loans: the
employer is technically loaning the equipment to the employee
for a fixed-period of time. Although employees do not actually
own the equipment, they remain custodian of the equipment
and are free to use it as they wish, providing it is mainly
for cycling to work.
What happens at the end of the scheme?
After the Agreement period is over, the employer may offer
to sell the equipment to the employee for its then fair market
value. If the equipment is leased the leasing company will
appoint the employer as the disposal agent. There can be no
automatic right for the employee to own the equipment at the
end of the hire term, otherwise the Agreement is deemed to
be a Hire Purchase Agreement, which does not attract the same
tax exemption. However, clearly it is in the interests of
all concerned if the employer does sell the equipment to the
employee at the end of the hire period.
What if an employee leaves early or is made redundant?
If an employee leaves before the end of the scheme, they must
pay their employer any outstanding salary deductions from
their final net salary, as compensation for non completion
of the salary sacrifice. They may then have continued use
of the equipment without further payment until the hire period
expires, when they may be invited to purchase the equipment
and become the owner. It is important that the employee is
not deemed to be given the automatic right to own the equipment
otherwise they would not be able to benefit from the tax exemption.
Employees must therefore not be offered the equipment to purchase
until the culmination of the hire term.
In the case of redundancy, the balance of payments due on
the equipment can be deducted from the employee's redundancy
settlement. The employer may of course choose to waive or
reduce this amount.
Who is responsible if the equipment is lost or stolen?
All equipment obtained through the bikescheme is the employee's
responsibility and it is a contractual term that they take
out adequate insurance to cover damage or theft, informing
the insurance provider that the owner (either the leasing
company or the employer) has an interest in the equipment for the duration
of the hire term. (This would normally be covered under an
employee's home contents insurance policy.)
Can you come and visit my company?
In order for us to be able to provide bikescheme to you free
of charge, we do not make company visits. This is a green
initiative and making journeys for face to face meetings are
not necessary. We hope you are not offended by our policy
please remember that you can contact us on 0845 672 0114 if
you have any queries not answered within this website.
We would like to fund the scheme ourselves, can this
be done?
Yes of course. Simply telephone us on 0845 672 0114 or drop us an email to info@runabikescheme.co.uk when you apply.
What documentation is there to sign?
There are 3 documents that are legally binding, and are as follows:
- A 3 way supplier agreement between your company, the leasing company and Halfords
- A lease agreement
- A Hire Agreement between the employee and the employer
Alternatively, if you have chosen to self fund, you will be provided with:
- A 2 way supplier agreement between your company and Halfords
- A Hire Agreement between the employee and the employer
These documents are prepared automatically and are made available at the appropriate time. If you wish to view any of these documents prior to setting up a scheme then simply call us on the runabikescheme helpline
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