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PC through work, worth considering?

zAndy1

Distinguished Member
Hi all,
My employer is offering a PC leasing scheme this year, it's with Evesham. I'm kind of interested in this offer:-

Athlon 64 X2 3800+
XP Media Center Edition 2005
256MB ATI Radeon X800GT (Tv-out & DVI)
19" Viewsonic VX912 TFT monitor
Nvidia Nforce4 motherboard
1GB dual channel PC3200 DDR RAM
200GB Serial ATA HD (8MB buffer)
DVD-ROM
Multi Format Dual Layer dvd writer
Nvidia 7.1 channel surround sound (on-board)
Creative Inspire T6060 5.1 speakers
3yr onsite warranty

Cost is £26 pm for 36 months taken out of my salary, option to buy at end of leasing period for < £50 (or take another PC assuming the scheme is still going)

They are also doing the e-box with a 27" LCD (shame it's not upgradeable to the 32"!) for £27 pm over 36 months. Also several laptops available as well...

I'm kind of tempted although I didn't think I would be when I heard they were going to do this. It doesn't seem a bad deal on the face of it and the fact I can't get credit anywhere now (not that I'd want to) means that an opportunity like this is quite appealing in it's own right!

Any thoughts?

Cheers,
Andy.
 

zAndy1

Distinguished Member
Not bothered about games to be honest, got my 360 for that!

Cheers
Andy
 

Uridium

Distinguished Member
Not a bad deal then, the 3x365 onsite warranty is worth at least £100.

360's are cool but nothing touches a high end PC for Immersive FPS gaming! but that's going off topic and in to a long argument!
 
G

GrandmasterMak

Guest
Hi

I might be able to help as i sell the HCI (Home Computing Initiative) scheme that your company is doing, but with a different provider...


First and foremost its a scheme thats been around since 1999 and its to get more people online and more importantly IT literate as we (UK) are well down compaed to other countries.

Its not everyday that the government gives us the opportunity to not pay TAX, NI or VAT on anything let alone a PC so make the most of it.

as a basic rate tax payer you wll save (over 3 years) 33% and as a high rate tax payer 41%.

Whatever happens you going to save alot of money and there are no direct debits, credit checks and high finance charges like the high street - but there is a finance charge between 6 to 10% which is absorbed into the price you pay.

If you need more info let me know as i can go on for hours!!!!
 

zAndy1

Distinguished Member
It's a shame we can't chose which provider we'd like to use (my mate bought his last PC from Evesham and it was a disaster so he ended up sending it back and getting one from Mesh, took a lot of hassle and time on the phone though and I sure as hell wouldn't want to go through that if I was tied into a lease for it!). It's also a shame we can't customise them like we'd be able to if we were buying it online. Still it's not a bad deal I suppose, although the literature is very misleading, the retail price quoted is about &#163;400 more than it comes to if you configure it online so the &#163;600 saving is a bit exagerrated!

Oh and Uridium, do you have a 360? Immersive to me is downstairs in the lounge on a 42" plasma with DD surround sound and a wireless pad. My current PC has a 6800GT in it so I'm used to high end gaming but I've completely lost interest in the PC as a gaming platform since getting my 360.

Cheers,
Andy
 

zAndy1

Distinguished Member
Been thinking about this and the current contract I work on only has about 2 yrs to run after which anything could happen with regards my employment status (either stay with my current company on another contract or more likely leave them). Am I right in saying that if I was to leave this company after 2 years that I'd have to pay 12 months gross payments (i.e. before the tax & NI saving has been deducted) in order to keep the PC? Bit of a shame there's this question mark over what's going to happen in 2 years time, just put that doubt in my mind as to whether it would be a good idea going for this.

Andy
 

Hyp3rion

Standard Member
Hi zAndy1
I got a mail shot yesterday from Evesham to in conjunction with my employer (CapGemini). Quite interested in the E_Box solution myself as i already have a pretty highspec PC.
It says in the blurb at the back that if you leave the company you have to pay any outstanding amount as a lump sum, so if thats 1 year left on your lease could be upwards of £300, even if you are made redundant you are expected to follow this rule .
 

zAndy1

Distinguished Member
Hi,
I'm with Capgemini too and got the same mailshot. I just wasn't sure how the outstanding amount is calculated. Take the example option 2, basic rate tax payer (well it is Capgemini after all). Cost through PC leasing &#163;953.64, &#163;39.54 monthly flex charge, &#163;26.49 monthly take home reduction (due to tax/NI savings), equivalent package cost through retail outlet &#163;1614.63. Let's say you make 24 payments = &#163;635.76. At that point if you leave the company or are made redundant what would you have to pay? Would it be a)12 x &#163;26.49 = &#163;317.88 or b) 12 x &#163;39.54 = &#163;474.48 or c) &#163;1614.63 - &#163;635.76 = &#163;978.87

My guess is it would be option b, the best answer would be option a of course

As for the e-box, heard a lot of horror stories about that, especially regarding the noise it makes, maybe they've improved it in that respect, if it had come with the 32" LCD I'd probably have gone for that option myself to be honest though.

Cheers,
Andy.
 

Hyp3rion

Standard Member
Yeah its a good question, as you would no longer be an employee you wouldn't have the flex uplift to fall back on. Its something i'm going to have a look at tommorrow on flex choices, there may be further info there.
As for the ebox as long as its not too noisy its ok as it is for a second room...it cant be any noisier than my xbox 360. :eek:
 

guv69

Active Member
The company I work for also have this scheme - but with Dell Computers. Unfortunately it is via a third party, who have inflated the prices to the point that the tax savings are eaten away.

Their prices advertised seem to be about 40% higher than you can buy direct from Dell. Total con and a pity they have chosen to promote a scheme that is deceptive.
 

zAndy1

Distinguished Member
Well it seems to be the same with the Capgemini scheme. If you price up that system online it doesn't come to anywhere near &#163;1614, more like &#163;1100 I think it was. So the saving isn't &#163;600 but more like &#163;200. Still a useful saving and the main attraction for me is that it's a relatively small monthly amount that I'll only spend on crap if I don't spend it on this! I think I will have a word with them though about the misleading advertising...

The good thing about the 3800+ Athlon that comes with the system I'm interested in is that it's a bloody good overclocker, not that I'm going to overclock it of course.....
 

BryanKitts

Active Member
A quick warning...

My employer has a similar 'flex' scheme (with Dell). In our case, the prices seem close to the website ones (although there's usually some 'limited offer' on the website that obviously isn't included).

However, reading the small print of the contract:
  1. My employer does not guarantee to offer the PC for purchase at the end of the period. It says it will normally do so, which is not quite the same thing.
  2. The final purchase is for a "small" additional fee, but there's no stated limit on how big this could be. I got the impression it might be £50, but maybe they'll decide to charge an extra £300 at the end (it was the first year of the scheme, so there's no historical precedent).
  3. If you leave the company or if the company makes you redundant, you have to pay all the rest of the payments immediately, in full (i.e. no tax breaks), and the company may still decide not to offer you the option of buying this PC that you've just paid for. I quote: "In addition, you must if so requested return the PC Package to us (or to a third party designated by us) by courier, at your own risk and expense."

It put me right off the idea, tax break or no. I have no idea if these are common clauses in HCI contracts or specific to my employer's, but make sure you read yours first...
 

BryanKitts

Active Member
Oh, I forgot some other gems from the contract:

4. No right to return to original salary
Please note that by choosing this benefit, you will not necessarily have the automatic right to return to your original salary at the end of the Hire Period.

...

6. Dealing with the PC Package at the end of the Hire Period
At the end of the Hire Period, we may request that you return the PC Package to us (or to a third party designated by us). If so requested, you must return the PC Package by courier, at your own risk and expense, and in substantially the same working order and condition as when we provided it to you (save for fair wear and tear). In addition, we may require you to pay a charge to cover our reasonable costs in disposing of the PC Package.​

So after you've paid for the PC, not only can they demand that the PC is returned to them at your expense, but they can charge you for scrapping it!
 

clockworks

Well-known Member
My employer (Siemens) was offering Fujitsu-Siemens PCs under this scheme at the end of last year. I decided to buy an ultra portable laptop.

They were offering the normal staff discount (which actually brings the price down to the best mail order price), then the tax/NI savings off the discounted price. There was no interest or charges for credit. I just pay the discount price/36, less the tax/NI saving.

The final payment was quoted in the agreement - about £60, IIRC. There is an option to send the PC if you didn't want to pay the final payment. I think this final payment or return option has to be in the contract, because it is a lease agreement, not an outright credit purchase plan.

The only negative is the fact that I have to pay the balance if I leave the company, losing the tax savings on the outstanding payments.

It seems to me that there are two types of scheme:

those operated by large companies, which are totally above board.
those operated by outside agents for smaller companies, where the figures are massaged to make a profit for the outside agency.
 

guv69

Active Member
BryanKitts said:
Oh, I forgot some other gems from the contract:

4. No right to return to original salary
Please note that by choosing this benefit, you will not necessarily have the automatic right to return to your original salary at the end of the Hire Period.

...

6. Dealing with the PC Package at the end of the Hire Period
At the end of the Hire Period, we may request that you return the PC Package to us (or to a third party designated by us). If so requested, you must return the PC Package by courier, at your own risk and expense, and in substantially the same working order and condition as when we provided it to you (save for fair wear and tear). In addition, we may require you to pay a charge to cover our reasonable costs in disposing of the PC Package.​

So after you've paid for the PC, not only can they demand that the PC is returned to them at your expense, but they can charge you for scrapping it!

I wonder if our scheme is the same! They certainly "charge" you for returning or buying, but Ive not seen anything about not being returned to your original salary.

Companys would obviously like these schemes if that were the case - not to mention lower pension contributions and reduced overtime payments.

We also have something going with Halfords for a bike. BUT there is an additional £49 admin charge just to kick it off! (and payment to buy back!) I would say they nust think we are stupid. Unfortunately some people are - and go on to defend what a great seal they are getting!
 
G

GrandmasterMak

Guest
Hi All

All good question and i'm glad your not diving in without looking at the small print 1st.

There are know 95 HCI providers out there all using different manufacturers but the biggest stubling block with any of them is the delivery - in some case its taken over 3 months to get one to an employee so be aware - some providers have a service level agreement which makes them delivery up to a certain period otherwise you get some sort of compensation.

If you are planning to leave before the 36 month period you may incur the tax, ni and vat on the remaining balance which would normally come out of your final salary. i say 'may incur' cos the legislation isn't completely clear; some provider will say no tax, ni or vat some say you will.

If you are a contractor then you shouldn't be able to join the scheme at all as you are not a PAYE employee from that employer.

The residual value (nominal payment) figure is also different for different companies - some £20 and some £60. This all to do with what the iland revenue see as the 'fair market value' of the equipment after 36 months. This is in fact £0 and the HCI rovider will make some more revenue this way but IR won't actually state what the figure should be so HCI provider have to put 'usually £X amount'.

. No right to return to original salary
Please note that by choosing this benefit, you will not necessarily have the automatic right to return to your original salary at the end of the Hire Period.

This is legally correct as you are reducing your salary to compensate your employer for providing you with this equipment - in reality what actually happens is that you will go back to your orginal salary but in between the 36 month cycle employee would of got pay rises / bonus etc which would put them on a high salary than they orginally had.

Anyone who has any specific questions let me know and i'll be hapy to help

GrandmasterMak
 

DarkDogZA

Active Member
Thats a far better one that we got. Last year, we had a flyer through BT offering Dell products which in a nutshell were overpriced and underspec'd and not worth the paper printed on.

Someone needs to setup something with Alienware :)
 

Dillz

Active Member
BryanKitts said:
Oh, I forgot some other gems from the contract:

4. No right to return to original salary
Please note that by choosing this benefit, you will not necessarily have the automatic right to return to your original salary at the end of the Hire Period.

...

6. Dealing with the PC Package at the end of the Hire Period
At the end of the Hire Period, we may request that you return the PC Package to us (or to a third party designated by us). If so requested, you must return the PC Package by courier, at your own risk and expense, and in substantially the same working order and condition as when we provided it to you (save for fair wear and tear). In addition, we may require you to pay a charge to cover our reasonable costs in disposing of the PC Package.​

So after you've paid for the PC, not only can they demand that the PC is returned to them at your expense, but they can charge you for scrapping it!

Speaking from an employer point of view these "little gems" as you call it are simply to beat the tax man and offer you a cracking good deal on a computer.

For a salary sacrifice to be valid i.e. tax free, you have to be seen to be giving up the right to salary, otherwise you are simply contributing from your pay before tax which is illegal. The other point is that the HCI scheme has to be a loan arrangement for the tax free free status to be valid, so the computer is officially classed as a "loan", which you lease through a finance deal equivalent to the purchase price then at the end you buy it for a nominal fee. A balloon payment I think it's called. They can't officially guarantee the computer at a set price otherwise the Inland Revenue would view the scheme as a purchase scheme not a loan scheme and hold your employer liable for all the unpaid tax.

We didn't in fact launch our scheme in the end because we had to set up the finance with the finance company and then recover the money from staff over 2 or 3 years. Having a high turnover we realised that if someone left before paying us back we would be stuck trying to recover the outstanding debt or seeking the return of a computer we didn't want. The Finance company salesman pushing th scheme was of course onto a win win situation.
 
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GrandmasterMak

Guest
Dillz - good points but there are ways to make sure you are covered for absconders, etc.

Your HCI provider should have worked with you to set an eligiable employee criteria which would of taken out alot of those employees who were likely to leave employment during the 36 term and not have enough money to pay the remaining balance.


I dont know your full circumstances but i'm happy to help www.flexstarconsulting.com for more info.

I have been doing this for 4 years and help contribute towards the dti guidelines for HCI.
 

BryanKitts

Active Member
GrandmasterMak said:
The residual value (nominal payment) figure is also different for different companies - some £20 and some £60. This all to do with what the iland revenue see as the 'fair market value' of the equipment after 36 months. This is in fact £0 and the HCI rovider will make some more revenue this way but IR won't actually state what the figure should be so HCI provider have to put 'usually £X amount'.

Thanks for the explanation: maybe I was being a little harsh on my employer (although I still don't understand why the Inland Revenue would require a clause about paying disposal costs if the employer asks for it back).

How does residual value work if I'm made redundant after 1 month? The contract states I have to pay the rest of the payments immediately (inc. tax, in this particular case), but the current market value of the loaned equipment would still be quite high since it's only a month old. Would that mean I'd have to pay a high nominal payment as well?
 
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GrandmasterMak

Guest
BryanKitts said:
Thanks for the explanation: maybe I was being a little harsh on my employer (although I still don't understand why the Inland Revenue would require a clause about paying disposal costs if the employer asks for it back).

How does residual value work if I'm made redundant after 1 month? The contract states I have to pay the rest of the payments immediately (inc. tax, in this particular case), but the current market value of the loaned equipment would still be quite high since it's only a month old. Would that mean I'd have to pay a high nominal payment as well?


The disposal costs are a way of ensuring that you don't actually send the machine back to your employer / HCI provider. The employer/provider needs to ethically to be seen as disposing equipment in a safe and proper manner cos the last thing an employee needs is returning the equipment back and whatever is on the hard drive could incriminate that employee / employer.

What always happens is that the employee would pay the nominal cost, keep the equipment, pass it on to family/friends to use and that employee would then take advantage of the scheme again - latest technology.

If you where made redundant after month 1 then you would have to pay the remaining balance off (final wage packet) and this figure would include that disposal/nominal fee as stated.

The HCI provider can't actually stipulate the actal figure but in all scenarios they will make you pay the 'usual' figure quoted.

Hope this helps
 

BryanKitts

Active Member
GrandmasterMak said:
The disposal costs are a way of ensuring that you don't actually send the machine back to your employer / HCI provider.
I still don't understand. The clause says:

"At the end of the Hire Period, we [the employer] may request that you [the employee] return the PC Package to us.... If so requested, you must return the PC Package ... In addition, we may require you to pay a charge to cover our reasonable costs in disposing of the PC Package."​

So the disposal cost in this contract is for the case when the employer chooses not to let the employee purchase the PC at the end of the Hire Period. The employee has no influence over this decision.
 
9

99Flake

Guest
uridium said:
Not bad for the price but you'll need a different Video card if you want to play any decent games at a decent level

Absoloute rubbish, that card will run most games at extremely high levels. I have one in my PC which is less powerful and Q4, Doom 3, FEAR and HL2 fly along at1280*1024 with image quality turned up. Ok it might get outdated in the next 18 months but until then it is still a very strong card. Outperforms a 6800 which is still considered to be a capable card. Unless you have £300-£400 to splash out on an X1800/1900 or GeForce 7800/7900 then you really don't get much better.
 

zAndy1

Distinguished Member
Funny I thought the X800 GT was a midrange card that compared with the 6600. To be honest I'm not bothered about PC gaming anyway, having said that I might be tempted to put an X1900 in it in 12 months or so cos they should be a reasonable price by then.
 

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