| Author |
 Topic  |
|
dazed and confused
Junior Member
United Kingdom
475 Posts |
 Posted - 09 September 2008 : 19:43:24
|
Dear Forum
I have just had a very scary thought - I recently signed up to an offer which we had on at work where Employees could get a bike at a reduced price and pay monthly over a period of 18 months. Basically, the way it works is that the Employer buys the bike, claims the tax back on it, and then 'loans' it to the Employee over a period of 18 months tax and NI free which comes directly out of my wages.
When I took out this agreement, I think it was in June / July 2008, going BR was not on my mind - in fact I was just about to enter into an IVA and the IP said it would be fine for me to go ahead with it. I was later talked out of an IVA due to my inability to be able to financially commit to it for 5 years.
Anyway, to cut a long story short, my 3 questions are:
1. Would my Employer now be classed as one of my Creditors if I waa to go BR?
2. Would I get into trouble with the OR for taking out this Agreement i.e. would it be seen as taking on additional credit?
3. Would payments for the bike be seen as 'preferrential treatment'?
I hope someone may be able to help me on this...
|
|
|
John
New Member
United Kingdom
73 Posts |
Posted - 09 September 2008 : 22:10:58
|
Hi
You might want to consider entering the details under the secured heading of section 4.
The loan is secured against the bike which your employer owns, presumably your employer reclaims it if you default, therefore unaffected by bankruptcy.
On the downside, by declaring the bike you may lose your car if you have one, it depends on your circumstances and the examiners view on it all.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
 |
|
|
dazed and confused
Junior Member
United Kingdom
475 Posts |
Posted - 09 September 2008 : 23:30:56
|
Hi John and thanks for your reply!
To be totally honest, I am not sure what the deal is if I were to default on the payments - I will have to check the Agreement I signed.
Would it have to be declared as it comes directly out of my wages?
When I took it out I thought I would be entering into an IVA and my main concern was that a Credit check would be done but I was assured that one wouldn't. I didn't think I would be considering BR!!!
The whole idea of getting the bike, aswell as the health benefits, was to try and reduce the mileage I do with work in my own car, which has not worked too well with the summer we have had!!!
It would be difficult for me to do my current job effectively without the use of the car...
Why is everything so complicated???!!! |
|
|
|
Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 09 September 2008 : 23:36:56
|
Hi
is it a bicycle or a motorbike / scooter.
You will also need to read the agreement carefully that you signed.
It is unlikely to be HP as your employer ( unless a bank ) is most likely not authorised to offer HP. They may actually own the bike and rent it to you until you have paid the final payment.
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
www.revivauk.com |
|
|
|
dazed and confused
Junior Member
United Kingdom
475 Posts |
Posted - 09 September 2008 : 23:44:20
|
Hi!
Sorry yes it is a bicycle! It's retail value was £650.
Yes I think I definitely need to re-read the Agreement I signed. I kind of did it all in a bit of a mad rush at the time. My head has been a bit all over the place the past few months!
I think that is how it works yes - that my Employer (Local Authority) own the bike and 'rent' it to me.
Does this change the matter?
I am starting to regret getting that bike at all now - I have only used it a few times with all the bad weather we have been getting!!! |
|
|
|
Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 09 September 2008 : 23:55:59
|
If it is rental then it isn't an asset and there is no eason you couldn't continue to pay for it from the disposable inacome you had even if you were given an IPA.
You may want to check what happens of you leave your employment. It may be that the employer deducts the balance from your final pay check so read carefully
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
www.revivauk.com |
|
|
|
dazed and confused
Junior Member
United Kingdom
475 Posts |
Posted - 10 September 2008 : 00:15:47
|
Hi Paul
Ok thanks for your help again. I will check the document again tomorrow and get back to you if that's ok?! |
|
|
|
grantspants
Junior Member
United Kingdom
297 Posts |
Posted - 10 September 2008 : 09:02:39
|
Hi folks 
This is the same topic I had the other day, but I haven't taken up the offer from work yet.
I have just been reading the hire agreement form again, and the bike does belong to the company, but it's called a 'salary sacrifice'.
I would pay to rent the bike from my company and the payment would come directly from my wages before tax and N.I would be taken, so saving what I would pay in tax.
I would want a bike so I could ride to work on my more sociable daytime shifts but still would use my car (worth £1000) on the bad night/early morning shifts.
Does anyone think I could take this offer up prior to BR (I go BR next tuesday 16th sept) because the offer ends for this year on 19th september?
I'm not sure how the OR would view it, can anyone help?
Thanks again |
|
|
|
John
New Member
United Kingdom
73 Posts |
|
|
pix1
Average Member
689 Posts |
Posted - 10 September 2008 : 11:51:20
|
| I am not sure if you have already gone BR. I think the key thing here is that you need to check the T&C's of your employment to see if going BR will be a problem. I am seriously worried that a local authority might terminate your employment if you are BR but I don't know for sure. If you can delay perhaps it would be better to put off the Br for a few weeks while you check all this. Maybe BR is not the right option if you want to keep your job. I don't want to be alarmist. I am just a bit concerned for you. |
|
|
|
grantspants
Junior Member
United Kingdom
297 Posts |
Posted - 10 September 2008 : 12:22:13
|
Hi John,
I think for a bike worth £600 the rental payment is £27.23 and total cost works out at around £354, thats if I have read the literature correctly. I have a copy of the agreement and payment/savings table that I can email you if you want?
Thanks
p.s I called the hotline and left a msg, but if you think we can chat via the forum then thats ok.
|
|
|
|
grantspants
Junior Member
United Kingdom
297 Posts |
Posted - 10 September 2008 : 12:39:21
|
whst do you think John?
Is this a bad idea? |
|
|
|
John
New Member
United Kingdom
73 Posts |
Posted - 10 September 2008 : 12:46:51
|
Hi
there would be nothing wrong with already being in, or entering into, this scheme now that we know that the bike is rented to you by your employer.
However, don't expect the OR to allow the monthly payment against expenditure, this will have to come from your share of your disposable income. |
|
|
|
grantspants
Junior Member
United Kingdom
297 Posts |
Posted - 10 September 2008 : 13:27:02
|
Thanks John
Although on my current SOA I have little or no D.I so my wife would maybe cover it for me.
hmmm, is there any way of finding out for definite if it's ok? |
|
|
|
John
New Member
United Kingdom
73 Posts |
Posted - 10 September 2008 : 13:38:45
|
Hi
I'm not sure what you mean.
Now that we have established the bike is rented to you then BR legislation dictates that it's ok.
If the examiner questions it stand your ground as it really is perfectly ok. The OR cannot dictate what you do with your share of your DI whether you have an IPA or not.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
|
|
|
dazed and confused
Junior Member
United Kingdom
475 Posts |
Posted - 10 September 2008 : 14:19:38
|
Hi!
So on the BR forms, would the bike come under an Asset or would the rental cost be counted as an Expenditure???!!!
Would it even need declaring as the money is deducted directly from my wages, like my Pension Scheme is?
Would the OR allow payments to continue to be made into the Scheme once BR, or if not would the OR allow a final lump sum payment to be made, which would then make you the owner of the bike and it would become an asset???!!!
Very confusing... |
|
|
|
Topic |
|
Bike Loans and BR...
