What happens at the end of the agreed payment period?
Though you will have full use of the bicycle, NBT will own it for the duration of the scheme. At the end of the period of hire, NBT may decide to transfer the bicycle to you for its fair market value at that time. The fair market value has in the past been in the region of 10% of the original value when selected (although this value may change). This transaction is outside the hire agreement and will be deducted from you net salary. If you dont want to buy the bike at the end of the agreed payment period you will be charged the equivalent of the fair market value for NBT to dispose of it. The fair market value cannot be stated before or during the scheme as this could be considered a benefit in kind and hire-purchase does not warrant any tax relief.
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