This is particularly the case as employers consider their COVID-19 return to work planning. Cycle to Work scheme is a UK Government tax exemption initiative introduced in the Finance Act 1999 to promote healthier journeys to work and to reduce environmental pollution.It allows employers to loan cycles and cyclists' safety equipment to employees as a tax-free benefit.
Tax is complicated; the cycle to work scheme is not. Plus cycling to work will bring health benefits and help you save money on your daily commuting costs. Documents . In practice, there are several other (cheaper) options, and few employers charge the fair market value.If your gross salary each month was £2000 you would normally pay £640 in combined Income Tax (20 per cent) and NIC (12 per cent).So if we go back to our £1000 bike, even in the least financially efficient scenario where you buy the bike straight after the 12-month loan period, it would cost you £680 of salary sacrifice and then £250 final market price, giving you a total of £930, saving you at absolute minimum seven per cent.Jones said: “If you were concerned at all, you can just say to the employer ‘I don’t want to keep it’, give it back to them and you won’t have to pay.”The Cycle to Work scheme was introduced in 1999 – the aim being to encourage people to make healthier and more environmentally friendly lifestyle choices.Ride to Work, Evans Cycles’ scheme provider, tells us the average spend is £800 – a figure it says is “a slight increase from recent years [due to] the cost of bikes rising due to inflation and exchange rate fluctuations.”Explaining the options, Evans Cycles’ representative told us: “If you leave your employer before you have completed the salary sacrifice term, any balance remaining must be repaid from your final net salary, i.e. Loving your bike in lockdown, but not quite confident to road cycle as Glasgow slowly opens up again? How do I get a Tax Free Bike through Cycle to Work? Guidance for employers who want to put in place a cycle to work scheme. To take ownership of the bike a transfer of ownership process will also apply within the HMRC Fair Market Valuation guidelines. It's like a year-round sale, with interest free credit available in over 2,000 retailers nationwide. People leave workplaces for many reasons – so what happens then?It’s also reasonable to ask if your pension or other benefits could be affected by opting in to the scheme.