Here are some of the common questions that come up for our clients. Please reach out to your Client Success Manager or Client Support if something isn't covered here.
Hire Agreement amount or Letter of Collection needs to be changed
Once a Cycle to Work application has been approved. The Hire Agreement and Letter of Collection cannot be amended. If the member would like to amend the amount, they can do so by cancelling their order (within 14 days) and provided the Letter of Collection has not been spent.
Employee wants to cancel prior to the close date of an application window
The window dates are not linked to application cancellations. For example, the applications can still be pending although the window has closed a week ago, or instantly approved although the window is still open. An employee can cancel their Cycle to Work order within 14 days of receiving their Letter of Collection (providing it hasn't been spent). For more information on refunds, please see the Cycle to Work refund process.
Employee wants to cancel application after the window closes and the Letter of Collection has been issued
Please be aware that Halfords have a 14 day cancellation period. If the employee has received their Letter of Collection and would like to cancel within the initial 14 day cancellation period, they can do so on the Order History page. If the employee would like to cancel their Letter of Collection after the initial 14 day period, they can request this from their employer and provide a reason for the request on the Order History page. Refunds can only be processed if the Letter of Collection has not been spent.
If the scheme is CtW Plus, then Halfords manage the cancellation. The Employee can find details of how to cancel in the same email where they receive their Letter of Collection.
How long is the Letter of Collection valid for?
Halfords have a 4 month expiry on every Letter of Collection. If an employee doesn't spend their Letter of Collection during this time, they cannot get a refund. The employee can request an extension on their Letter of Collection directly from Halfords by calling their Cycle2Work team on 08450 778850 or via email email@example.com
What happens if the employee leaves or gets made redundant before the end of the hire period?
If the employee leaves before the end of the hire period, they must pay their employer the balance of the amount outstanding. This should be deducted from their final net pay. The employee will no longer be able to benefit from the tax exemption.
This transfer of ownership is the subject of a separate agreement and isn't governed or influence by the Hire Agreement the employee signs for the scheme. Leavers are still eligible for Managed Extended Hire, they should be transferred at the scheduled end of their Agreement.
For more guidance to how to transfer ownership of the cycle to employees before the end of the hire period, please see more information in this HMRC Cycle to Work guidance document.
I want to give the employee the bike
For the employer and the employee to benefit from the tax exemption, the employer must own the bike for the hire period. The ownership of the bike must be transferred via one of the HMRC approved methods (Managed Extended Hire, P11D or Market Value). If the employer was to simply give the bike to the employee, it would be seen as a Benefit in Kind and the tax saving no longer available.
What happens to salary deduction for CtW during Maternity or Sick Leave?
If an employee is absent from work during the period covered by their Cycle to Work Hire Agreement, their salary reduction will remain in place and will apply to any pay received (including sick pay or maternity pay). For more information, please see What happens to salary deductions during maternity or sick leave.
What happens to our employees in Jersey or Guernsey?
Employees who are based in Jersey or Guernsey are still eligible to apply for Cycle to Work, however they are required to pay a Goods Service Tax at 5% on all goods over the value of £240.
The Net deduction option - are the net deductions reflected as such in the payroll report?
Yes, there is a seperate column in the report which shows the application type (e.g. net or gross) against every application.
How long would it take to switch the Net deduction option?
It is instant, as soon as the client decides to make it available for their employees, then can switch it on directly from the product setup on their administration portal using the guidelines provided.
If any issues arise that are not mentioned above, please contact firstname.lastname@example.org who will be able to help.