Hi,
Hoping someone can help. I currently ommute to my clients office 3 days/week on the tram. Have now moed house and looking into getting a bike and cycling to clients office along the canal etc. Been looking into the main ways to efficiently do this and the two main options seem to be (1) MyCo paying for the bike and then lending it out to employees for their use or (2) I buy the bike myself and then claim back expenses at 20p/ mile.
There are loads of people asking similar questions across the net but seems people cannot agree on the right answer. One person on this forum stated:
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It says: "Payments of up to 20p per mile may be made for business travel on an employee's own bicycle"
wtf does that mean anyway - up to 20p - is it up to the employer to set the mileage rate - so for us it's automatically 20p?
Now, let me get this straight. Buy a bike and all the gears (helmet, lights etc). Let's go cheap and say it costs £200 all up.
1st option - the business buys this and lends it to me. This, therefore, reduces company profit by £200 and saving approx £40 in tax to pay.
2nd option - I buy all this personally and use to get to my place of work and home. Let's say my generous employer allows me to claim 20p. I bike to work, 10 miles, I bike home, 10 miles. 20 miles = £4. Over a week that's £20. Now, how does it all work from here? Does the £20 a week come from the company (so reduces profit by £20 and saves £4 corp tax) and then paid to me. This £20 I get in my bank is then not liable for any further tax/NI.
Option 2 sounds like a pretty good deal at the moment but have I missed something key here? After only 2 weeks I am better off than option 1. There's a few hundred quid coming my way me thinks
And then there's the cycle to work day lunch to consider too! More info on this please.
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Can anyone shed any light on what is the best, most tax efficient, money saving way of doing this as I now have a bike in mind (costs £1500 approx) and want to buy it so I can start commuting to work on it from next week.
Oh, and although I will use it sometimes for personal use, the lions share will be business use.
Thanks for any help you clever people can give me
Hoping someone can help. I currently ommute to my clients office 3 days/week on the tram. Have now moed house and looking into getting a bike and cycling to clients office along the canal etc. Been looking into the main ways to efficiently do this and the two main options seem to be (1) MyCo paying for the bike and then lending it out to employees for their use or (2) I buy the bike myself and then claim back expenses at 20p/ mile.
There are loads of people asking similar questions across the net but seems people cannot agree on the right answer. One person on this forum stated:
--------
It says: "Payments of up to 20p per mile may be made for business travel on an employee's own bicycle"
wtf does that mean anyway - up to 20p - is it up to the employer to set the mileage rate - so for us it's automatically 20p?
Now, let me get this straight. Buy a bike and all the gears (helmet, lights etc). Let's go cheap and say it costs £200 all up.
1st option - the business buys this and lends it to me. This, therefore, reduces company profit by £200 and saving approx £40 in tax to pay.
2nd option - I buy all this personally and use to get to my place of work and home. Let's say my generous employer allows me to claim 20p. I bike to work, 10 miles, I bike home, 10 miles. 20 miles = £4. Over a week that's £20. Now, how does it all work from here? Does the £20 a week come from the company (so reduces profit by £20 and saves £4 corp tax) and then paid to me. This £20 I get in my bank is then not liable for any further tax/NI.
Option 2 sounds like a pretty good deal at the moment but have I missed something key here? After only 2 weeks I am better off than option 1. There's a few hundred quid coming my way me thinks
And then there's the cycle to work day lunch to consider too! More info on this please.
---------
Can anyone shed any light on what is the best, most tax efficient, money saving way of doing this as I now have a bike in mind (costs £1500 approx) and want to buy it so I can start commuting to work on it from next week.
Oh, and although I will use it sometimes for personal use, the lions share will be business use.
Thanks for any help you clever people can give me
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