Cycling brings about better physical and mental health, saves on transport or fuel costs, and is kind to the environment. But adding a Cycle to Work scheme as an employee benefit does more than help your people and the planet – it could bring business benefits too.
According to Cycle to Work Alliance, over 1 million employees already currently take advantage of Cycle to Work schemes. And with people taking to their bikes during lockdown, plus increasing government investment in cycling as a healthy method of transport, there’s never been a better time to consider introducing a scheme.
A Cycle to Work scheme can benefit both the employer and the employee.
Cycle to Work is a great employee benefit which offers the most cost-effective way to get new cycling equipment (bike, helmets, bike locks, cycle clothing etc.). The scheme is run via a salary exchange meaning the employee won’t pay Income Tax or National Insurance, saving them between 32% and 42% on their new bike and accessories. This reduced cost is simply deducted out of their payslip over 12 or 18 months.
Employers will also make a 13.80% National Insurance saving on the amount the employee sacrifices each month. There is no cost in setting up a Cycle to Work scheme either – only the time to administer the benefit through your payroll.
Any employer, of any size, across the public, private or voluntary sectors can run a Cycle to Work scheme. However, the Income Tax and National Insurance benefits apply only to staff who are treated as employees for tax purposes.
Please do not hesitate to contact us if you have any questions about launching a new Cycle to Work scheme, or any of your other Employee Benefits.
Terms, conditions and restrictions do apply. This guidance reflects the tax and legal position at the time of publication.