Halfords end of hire solutions

Extended Hire Solution
What is it?
At the end of the initial hire period the employer allows the employee to continue using the equipment – at no additional cost –
via an extended hire agreement. An extended hire agreement postpones the point at which transfer may happen, which in turn
sees the residual value – as defined by the HMRC valuation matrix* – of the equipment depreciate.
Why choose this?
3 Perfect for organisations keen to maximise savings for employees but where the P11D solution is felt to be
unsuitable
3 Use of the HMRC valuation matrix* avoids any challenge from HMRC
Example – based on lower rate tax payer:
Employee selects £450 Letter of Collection (inc. VAT)
• At the end of the initial period the employee enters into a further 5 years extended hire agreement. The employee
incurs no further cost for this agreement
• At the end of 5 years the HMRC valuation* is £0
• The equipment may be transferred to the employee for £0
If the employee leaves employment part way through the extended hire term, transfer is charged in line with the HMRC
valuation matrix*.
Halfords fully managed End of Hire solution
We help
You choose the right end of hire
solution for your organisation
Employee chooses to
Halfords will provide a fully managed solution by
• Contacting each employee offering them the opportunity to extend
the hire/return the bike
• Providing explanations on how each of the solutions may affect their
savings and responsibilities
• Offering a Halfords contact email and telephone number to handle
any incoming enquiries
• Supplying a set of FAQ’s specific to your end of hire arrangement (we
can tailor these if you wish to include your own employee message)
“Extend the hire”
Employee chooses to
Halfords will
•Issue a new agreement to all scheme members detailing the
terms and conditions of the extended hire period
•Receive these hire agreements at Halfords Head Office and
chase any outstanding agreements
•Securely store these hire agreements for you
•Offer to provide you with the agreements at your
convenience, either hard copy or electronically
•Handle any employee queries
•If an employee leaves prior to concluding the extended
hire agreement, Halfords can contact them and arrange for
collection of bike or payment of transfer value
“Return the bike to Halfords”
Halfords will
•Contact the employee to arrange return
of the bike to their local Halfords
•Confirm the bike is returned to the store
•Chase up any unreturned bike
•Arrange for the disposal/recycle of any
unwanted bikes
•Handle any employee enquiries
Halfords Limited is advised on tax law and all Cycle To Work-related legislation by one of the UK’s leading tax advisers and endeavours to provide recommendations to all clients and prospective clients in accordance with prevailing tax law and
relevant legislation. Halfords Ltd. recommends that all parties seek separate independent tax advice in all circumstances. Halfords Ltd are not tax advisers and accept no liability for the actions of any party acting upon recommendations provided by
Halfords Ltd. * HMRC valuation matrix can only be used to calculate the fair market value for employment Tax purposes. Printed July 2011.
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