This page provides a brief introduction to the UK Government’s Cycle to Work scheme and how it is administered.
What is the Cycle to Work Scheme?
To promote healthier journeys to work and to reduce environmental pollution, the 1999 Finance Act introduced an annual tax exemption, known as the Cycle to Work scheme, which allows employers to provide cycles and cyclists’ safety equipment to employees as a tax-free benefit. The exemption was one of a series of measures introduced under the Government’s Green Transport Plan. The official Department of Transport guidelines give the detailed background on the scheme, but are quite heavy going!
Is there more than one scheme?
There is only one Cycle to Work tax exemption scheme – but there are a number of scheme operators that can help in the implementation and administration of the scheme on behalf of employers and employees. We work with most of the Cycle to Work scheme operators, including Cyclescheme, who are by far the biggest, Cycle Plus, OnYourBike, Salary Exchange etc.
Each Cycle to Work scheme operator will have slightly different procedures and guidelines, but all will conform the UK Government tax exemption regulations, and all will deliver significant savings (of up to 42%) on the purchase price of new bikes. Please note that the scheme only applies to brand new bikes.
The tax break applies to purchase values of up to £1000, but with Cyclescheme you are free, as long as your employer does not object, to add your own top-up payment in order to purchase a bike over the £1000 limit. The tax savings will only apply to the first £1000, but this still a significant saving for many buyers. Top up payments cannot be made using 0% Finance, as it is not possible to have two finance agreements on one item.
To give you an idea of potential savings, please try out the calculator below. We are only too happy to talk to you about how you can purchase a bike from us under any of the schemes.