If you are looking to own a brand new bike and accessories at an affordable price, then tax free savings through a cycle to work scheme could be the way to pay for you.
Thanks to a government backed scheme you can save up to 42% on a new bike and safety equipment.
The scheme works as a salary sacrifice giving up part of your salary in exchange for a non cash benefit; in this case the bike and safety accessories, so you save on tax and national insurance.
Your employer buys the bike and equipment then leases it to you through an interest free salary sacrifice scheme so you will pay less for your bike and will be able to pay in installments.
We accept vouchers from the following providers:
We accept vouchers from most national schemes like Cyclescheme and Cycleplus. We also accept vouchers from in-house schemes run by independent companies, for example Kingspan, NHS, Sodexo. If your voucher is from any other scheme, please get in touch at; [email protected] to check if we can accept it.
If your employer is already running a scheme, you’re just a few steps away from receiving your new bike and equipment.
To benefit from the Cycle to Work scheme’s tax and national insurance savings, you must:
- Be an employee, not self-employed.
- Receive your salary by PAYE.
- Earn more than the national minimum wage after the salary sacrifice
How much will I save?
This all depends on your own tax status. Generally basic rate taxpayers will save 32% and higher rate taxpayers 42%.
How much can I spend?
For most people, the maximum is £1,000 including VAT. If you want a higher loan, check with your employer who may be able to offer you a higher loan.
What can I buy?
Any cycle you can use for commuting, for example road, hybrid and mountain bikes. You can also use your voucher to get any safety equipment you need for commuting. This might include items such as Helmets, Lights, Locks, Pumps and cycling clothing.
Who owns the bike?
Your employer owns the bike and equipment and loans it to you during the hire period.
What happens at the end of the hire agreement?
To keep the scheme tax free, there can be no guarantee your employer will transfer ownership at the end of the hire period. However, this is usually what happens. Because HMRC has set fair market values that the employer must pay to keep the bike, you may be asked to pay 18% of the value for a bike costing less than £500, or 25% for one costing £500+. More often, though, your employer will agree to extend the hire period by up to 36 months. During this time you make no further payments and at the end of the term the bike’s fair market value is considered negligible and ownership will be transferred to you.