Can I import a bike under the cycle to work scheme?

[lop130371]

I was in Dublin city center two weeks ago. Normally I park my bike inside the Drury car park for safety reasons but was in a rush to do something and a bit far from the carpark so I hooked it up on one of those bike racks. Despite being in broad dailight in a very well populated area with a lot of offices and cafes around, somebody tried to break the lock and steal it. He was unsuccessful but in the process, the carbon fiber frame got a large crack and rendered the bike basically useless, dangerous to use , fit for the bin.

The relatively good news is that I had bought that bike 4 years ago in November and can now avail of a new tax break for a new bike. I focused on a particular Trek bike which I find in Germany in a online shop (In the past I bought a few bike accessories from them) for about 1500€ plus 80€ shipping VAT included, the cheapest shop that I found in Ireland selling the same bike has it for about 2500€. I wonder if it's possible to buy the bike in Germany and still avail of the cycling scheme ? How would it work with regards to VAT ?

Thanks
Luke

 

[balders93]

I wonder if it's possible to buy the bike in Germany and still avail of the cycling scheme ?

There are no restrictions as to where the employer can purchase the goods from. However, all invoices and the documented prices on the paperwork for the purchase should be in Euro, regardless of where the bicycle is purchased.

https://www.revenue.ie/en/tax-profe...ins-tax-corporation-tax/part-05/05-01-01g.pdf

The exception to the above is If you are a civil or public servant, the cycle shop must be on the suppliers list.

 

[balders93]

How would it work with regards to VAT ?

7.2 Purchases Outside the State
Under the terms of s24(1) of the Value-Added Tax Consolidation Act 2010 (as amended), bicycles and/or safety equipment purchased from a VAT registered supplier in another EU Member State will be treated as an Intra-Community Acquisition for VAT purposes. Where the bicycle and/or safety equipment is purchased from a supplier in another EU Member State, the supplier should be given the employer’s VAT number and should not charge any VAT on the purchase.

Where proposed expenditure (inclusive of delivery charges), exceeds the relevant threshold limit, the Euro invoice (Zero VAT applied) submitted to the employer should be for the total amount due to the supplier. The employer will calculate the final amount due for payment after applying VAT at the appropriate rate and advise the employee accordingly.

Any balance exceeding the relevant threshold limit will be required to be paid by the employee to the employer immediately by way of Bank Draft.

The employer will then pay the supplier the amount invoiced. The employer will also forward the VAT due to the Collector-General

https://www.revenue.ie/en/tax-profe...ins-tax-corporation-tax/part-05/05-01-01g.pdf

 

[Leper]

I was involved in administration of the Bike-to-work scheme before I retired. There were restrictions like being obliged to buy from a named supplier. I don't know if that restriction has been lifted since. I think you should contact the people involved in the administration before you import any bike.

 

[Cervelo]

I wonder if it's possible to buy the bike in Germany and still avail of the cycling scheme

Yes you can, but it depends on whether your employer will allow it or not
My own business didn't operate the bike scheme when I worked there, full stop.
Others restrict it to certain times during the year and only for a certain number of employees and some might restrict it to one particular shop
So check with your employer first before purchasing

How would it work with regards to VAT ?

Most online suppliers in Europe will probably charge you the Irish vat rate
So if you going to buy it yourself, you should just be able to give your employer the invoice for a refund
and then the company will deduct from your salary but again check with your employer if this is acceptable to them

 

[CharlieMac]

There are no restrictions as to where the employer can purchase the goods from.

The employer will then pay the supplier the amount invoiced.

I was involved in administration of the Bike-to-work scheme before I retired. There were restrictions like being obliged to buy from a named supplier.

Others restrict it to certain times during the year and only for a certain number of employees and some might restrict it to one particular shop

...you should just be able to give your employer the invoice for a refund..

So much contradictory advice in this thread.

 

[Cervelo]

So much contradictory advice in this thread.

Care to point it out because I'm not seeing any "contradictory" advise

 

[balders93]

So much contradictory advice in this thread

My take from the other posts is that although there is no revenue mandated supplier list, employers may limit it if they have deals with 3rd parties / to minimise their overhead on offering scheme benefits to employees.

 

[lop130371]

Thanks, I will check with my employer. Also I noticed that in terms of VAT when I select "ship to Ireland", the bike store automatically changes the VAT appield to 23% from the default German VAT of 19%

 

[ClubMan]

Also I noticed that in terms of VAT when I select "ship to Ireland", the bike store automatically changes the VAT appield to 23% from the default German VAT of 19%

Value Added Tax

Value Added Tax (VAT) is included in the price of most products and services. Find out more about VAT and how it is paid.

www.citizensinformation.ie

From another EU Member State

If you buy goods online or by mail from another EU member state you may pay VAT at the rate that applies in Ireland. However, if the supplier that you are buying the goods from has not exceeded the Distance Sales Threshold in Ireland then you will pay VAT at the rate that would apply in the country of purchase. You will usually be told the amount of VAT payable at checkout.

 

[Leper]

@CharlieMac informed us of contradictory advice on this thread and he's right, there is contradictory advice. I posted that the OP should contact his/her employer to see the conditions of the bike-to-work scheme. When I was participating in administration of the scheme the applicant was confined to certain suppliers only. The consensus here is that a supplier can be sourced even outside of Ireland. I'm retired for years and things may have changed (no problem with me there) so I merely posted in the thought that I was of help.

Incidentally, I have seen threads on every forum where people give their opinion as fact and some of those opinions are blatantly wrong.

 

[Cervelo]

So if you going to buy it yourself, you should just be able to give your employer the invoice for a refund

It appears from citizens advice that I may be wrong here as they say
"Please note that your employer must pay for the bike.
The tax exemption does not apply if you pay for the bike and your employer reimburses you."
But revenue say
"Your employer may buy the bicycle and not require you to pay for it."

In practice when I worked in a bike shop from '13 to '17 customers had no problems or issues with paying for the bike themselves and getting reimbursed by their employer but the majority did get a pro forma invoice and collected the bike when the employer paid for it
My understanding at the time was that once the invoice was made out to the company, revenue were happy to accept this,
maybe the owner of the shop and I by default were wrong in our thinking??

But the main point about any advise here is for the OP to contact their employer and find out what the T&C's are for their employers operation of the CTW scheme

 

[ClubMan]

Incidentally, I have seen threads on every forum where people give their opinion as fact and some of those opinions are blatantly wrong.

You can reply to correct mistaken info or even report the post if the misinformation is particularly egregious.

 

[Buddyboy]

I believe the information is not contradictory, but is because each employer can dictate the rules that they want you to abide by, for their particular process. In my case, I had to purchase from a set list of local suppliers, as they wanted to give any business locally. But that was my particular employers method of administrating the scheme.
They did not allow you buy your bike from larger bike chains (pun intended).

In short, check your employers rules, and abide by them.

 

[Annieindublin]

I discovered that we had some restrictions as they outsourced the admin and the provider they used only used certain shops. And not the one I had picked out. I needed to spend more get the same spec but would get the tax relief. Which brought it down to the same price anyway. But just generated more paperwork