It’s a tough time for everyone. Everyone feels that they get less value from our hard-earned money. The cost of fuel is at record highs and inflation is projected to reach 11% by the fall. In addition, we’re all preparing for October, when the energy price cap will increase once more. The economy is tight and everyone has be able to restrain their budgets survive.
The internet is brimming with great ideas from people such as Martin Lewis on how to save money at home. It’s no doubt that we’re all trying to cut down on our energy bills in the present and this is easy in summer, as we’ve just had the hottest day ever recorded here in the UK. But winter is on the way, and we are aware that cool showers and eating a salad each day, and keeping lights off until 10pm in the evening will not cut it.
How else can we save money?
How do I cut down for my daily commute?
There’s one thing you might not have thought about when deciding how to reduce costs. Change to a bike for transportation instead of your costly gasoline-guzzling vehicle. Diesel and petrol cost around £2.00 per litre in many areas in the UK. It is worthwhile to think about whether your commute to work can be accomplished with a bike. There are many benefits of using a bicycle such as improving your fitness level, your well-being and bank balance. There is also the impact on the environment that cycling can bring. Did you know for instance that 20 bikes can be parked in the exact space as a car? It takes about five percent of the materials and energy needed to construct cars to make the bike? Using a bike produces zero pollution.
However, I don’t have an bike!
This is where the government has come in to make life little more easy for those who want greener and more affordable way of getting around. The Cycle to Work scheme was created in 1999 by the Government in 1999 to “promote more healthy commutes to work and lessen pollutant emissions” and is currently employed by over 1.6 millions of commuters.
The Cycle to Work scheme can help you save at least 32% of the cost of a bicycle and other cycling equipment. Basic rate taxpayers get 32% off of the cost of purchase, and higher rate taxpayers can save up to 42 percent (the 40 percent tax rate currently starts when you reach £50,000).
This is before thinking about the ongoing savings in maintenance and fuel costs compared to driving cars.
How do they work?
In principle the scenario, your employer purchases an automobile that you can ride to work, and you then ‘hire the bike back via salary sacrifice. This is a way to save money because you don’t have to pay income tax or National Insurance contributions on the monthly ‘fees’, which are deducted from your net salary, not net pay each month. After the “hire” period, you’re usually given the possibility of purchasing the bike from your employer.
The monthly instalments you pay for your bicycle will reduce the amount you earn. This means you’ll pay less cost of tax as well as National Insurance contributions you’d pay on this portion of your paycheck for the duration in the Cycle to Work agreement.
Employers also save the cost of employers’ National Insurance – so its an all-win situation!
It is it simple to create an employer?
We understand! There’s so much administrative and red tape to deal with that the office that the last thing you would like to perform as an employee is increase it. While you can set up and manage a Cycle to Work scheme yourself We would suggest hiring an organization to manage it on your behalf. It takes all the confusion away, and you won’t have to trawl through the law. The scheme operator will require authorization from the Financial Conduct Authority. It is crucial to ensure that your plan is conforming.
In case you didn’t notice it, there’s an incentive to you financially as an employer too. The company can save employees’ National Insurance on the monthly “fees.
Do you see any negatives to this?
Hmmm…. losing weight, being healthier as well as saving money and, most important, helping the environment All of these are good motives to cycle to work! However, there are some things to consider about the negatives:
The reduction in your gross income could affect other benefits, such as mandatory sick pay, as well as the amount of your pension contribution;
It can also affect the amount you’re able to get for your mortgage, as the monthly payments decrease your gross income;
You’re not allowed to make charges that bring your salary to less than the minimum wage.
In the event that your vehicle is taken you’ll be still responsible for the cost of repairs, so be sure to get insurance!
What happens after the expiration in the Cycle to Work agreement?
In the real world, everyone knows it’s the worker who is “buying the bike. Legally, that’s not an issue till the time when salary sacrifice is over and the employer sells bikes to employees.
When you have completed the contract, you have a couple of options, based on the extent to which you’ve enjoyed your new levels of fitness and the flexibility of cycling to work every day:
In a second contract, making an amount of money to hire the bike
Take the bike you want from the scheme
Return the bike.
Where can I purchase a bicycle? I’m in desperate need of a bike!
It’s been thought that your commute to work can be done by bike, and you’re looking to make some extra cash at the end the month. Perhaps you’d like to get healthy and shed some pounds. It’s not going to get any better without your efforts.
Find out if your company has a Cycle to Work scheme. they’re part of an Cycle to Work scheme – in the event that they don’t provide this blog! If they do, make sure you have been signed up with any specific scheme or inquire from the HR department whether they have any preferences over the shop you buy from. There’s no limit on the amount you can spend, however, this might be restricted by your employer’s and plan provider’s restrictions therefore don’t buy immediately without conducting some research before you buy! You may be even enticed to buy an electric bike since the cost of them is currently within your reach.
The majority of bicycle stores in the UK offer bikes via various cycles to Work schemes, as do several online stores. Be sure to test before buying so you should start by visiting an establishment that sells bikes to work out the measurement of your legs and determine which frame is appropriate for your needs. Remember to spend on a bicycle helmet as well. It’s better to be safe than sorry!
Are you a good candidate for you interested in the Cycle to Work scheme for you?
In the final analysis, it doesn’t mean you need to take your new bike on every trip to work. Don’t be deterred by the thought that someone is looking to see how often you utilize the bike. Each bike ride is a great way to save money and have an influence on health as well as environmental impact, however don’t think you have to take your bike to work every single day. It’s the way to go. UK weather being the way it is it will have those daytime rainy and windy ones when no one wants to get up or even put on a lycra dress and pedal miles to work torrential rain. What could be better than the feeling of cycling down a country lane in the sun and knowing you’ve completed your small part today to improve the world as a environment!