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Cycle to work scheme available for employers and their employees

11/05/2020

The Covid-19 pandemic has led to many people taking up cycling not only as a hobby but also as a lifestyle choice to help adhere to social distancing by reducing use of public transport.

A government scheme is available for employers to set up as a benefit for employees who would like to take advantage of cycling to work and can help employees to save between 25% and 39% on the cost of a new bike or an electric bike.

As an employer you would have to sign up for one of the official ‘Cycle to Work’ schemes which then allows you to buy a bike for your employee to ride to work and you ‘hire’ it to them through salary sacrifice (which is where you save by not paying tax and National Insurance on the monthly fees). At the end of the ‘hire’ period, the employee is entitled to buy the bike from you at a fair market value.

There is also the option of employees providing a loan to the employee. Loan schemes would also be on an interest-free basis and may be subject to regulation by the FCA.

For more information on the ‘Cycle to Work’ scheme please download the official Government guidance here.

 

 

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