What is Cyclescheme?
It enables workers to save at least 25 per cent on a new bike and/or bike accessories. It's like a year-round sale, with interest-free credit and no credit checks, available in over 2,000 local bike shops nationwide.
To be eligible for the discount, your employer needs to sign up through Cyclescheme.co.uk. You can invite them to join too. It's free to join, easy to administer and has no hidden costs. Your employer may not be part of Cyclescheme but it may run a similar initiative, so it’s worth checking with your HR department.
You save 32% if you’re a standard-rate tax payer
How do you get a discount through Cyclescheme?
Once your employer has signed up, choose from over 2,000 local bike shops, or go online to get a quote. It then takes around 5 minutes to apply. Your employer will then approve your application and pay for the package. Cyclescheme will then email you an eCertificate enabling you to collect the gear.
A set amount will be taken from your salary each month in exchange for hiring your bike package through your employer. It’s taken from your salary before tax, so you save 32% if you’re a standard-rate tax payer, or 42% if you’re a higher-rate tax payer.
What happens when my hire period is over?
Once you have completed your hire period you have three options. The most popular option is paying a small refundable deposit to continue hiring the bike for the same period as before. Once this hire period is over, the user now owns the bike. The deposit is 3% if the bike cost under £500, or 7% if it cost over £500. This means that total savings start at 25%, but many riders save more. You can also opt to take ownership of the bike by paying the market value minus a percentage in line with HMRC rules or you can simply return the equipment to Cyclescheme.
Why do you get a discount through Cyclescheme?
Cyclescheme is a Government-backed organisation. Within the Government’s Green Transport Plan, there is a tax exemption that allows employers to provide bikes and bike accessories to employees as a tax-free benefit. The condition is that the bikes are mainly used to get to and from work, or for work-related purposes. Self-employed workers who do not earn a PAYE salary are sadly ineligible.
I live in Ireland, am I eligible?
Cyclescheme Ireland’s website is at cyclescheme.ie. The scheme works in the same way, but your tax savings will be different to those outlined above.
- If you're rusty, build confidence on Cycle to Work Day on September 3rd.