Cyclescheme no longer has a limit! This means you can save money on everything you need. Go for a bike, a bike and accessories, or just accessories – it’s your choice!
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Cyclescheme is an employee benefit that saves you 25-39% on a bike and accessories (or even more with our offers). You pay nothing upfront and the payments are taken tax efficiently from your salary by your employer.
What can I get?
Cyclescheme no longer has a limit! This means you can save money on everything you need. Go for a bike, a bike and accessories, or just accessories – it’s your choice!
What is an ownership fee?
An ownership fee is a cost you must pay at the end of your Hire Period if you wish to keep your bike. The fee enables you to retain the bike whilst avoiding any benefit-in-kind liability.
Cyclescheme strongly recommends that all participants that wish to keep their bike and/or accessories packages choose the 'Own it later' option (as it's the cheapest).
There are 3 options to choose from, these are detailed below:
1) Own it later - You pay a small refundable deposit (either 3% or 7% of your certificate value) and continue to use the equipment for 3 years. No other payments (whatsoever) are required during this time. At the end of the 'Own it later' period, no further action or payment is required if you wish to keep the equipment - we simply retain your deposit and transfer ownership to you. Cyclescheme refunds the deposit if you do not wish to keep the equipment.
Ownership doesn't have to be expensive. Cyclescheme always recommends you choose our 'Own it later' agreement - this ensures fantastic end-to-end savings of at least 25-39%.
2) Own it now - Take ownership of your package by paying Cyclescheme the market value (e.g. for a one-year-old package this would be 18% or 25% of the Certificate value in accordance with HMRC requirements).
3) Return - Return the package to Cyclescheme at your own cost and pay no ownership fee.
Cyclescheme will contact you with your ownership options at the end of your Hire Period. This is usually 12 months from the point you received your Certificate used to collect your bike.
How much can I spend on the cycle to work scheme?
The cycle to work scheme does not necessarily have a limit. This is to ensure riders can get the exact bike they need to improve their commute, for example:
Employers have increasingly offered schemes without limits but it's not universal. Employers have to consider their cash flow and their employees' eligibility to join the scheme. It's important that we note that employers are under no obligation to offer schemes with a limit in excess of £1,000.
It's very rare for employers to have a minimum spend, but this can occasionally be the case (at the employer's discretion). Unless you've been told otherwise, it's fairly safe to assume this will not apply to you.
How can I check what my employer's cycle to work limit is?
You simply need to enter your employer's name or code into the 'I'm an employee' section of the Cyclescheme website and check the welcome message.
Example of an employer that has no limit:
Example of an employer that has a £1,000 limit:
Can I add funds (top-up)?
The Government (by way of the Department for Transport) have recently (13/06/19) updated their guidance on this matter and clarified that adding funds is not allowable.
If you wish to spend more than your Certificate value, you will need to cancel it and reapply.
How are cycle to work savings made?
Cycle to work operates as a 'salary sacrifice' employee benefit. This means that you agree to give up part of your salary in exchange for a benefit – in this instance the benefit is a bike and/or accessories. The salary sacrifice is taken from your gross salary (before tax) which means that you will pay less Income Tax and National insurance.
How does salary sacrifice create a saving?
The saving is achieved by paying for the bike and/or accessories directly from your gross salary (before tax). This means your income tax and national insurance is based on your salary less the cost of the bike and/or accessories. This means that your income tax and national insurance is calculated on the reduced amount of salary. Hence, the amount of tax and national insurance you pay is less.
Normally, when you get a bike the process looks like this:
When you get a bike via salary sacrifice the process looks like this:
The graphic below visualises this:
As you can see, by going down the salary sacrifice route you will lower the amount of income that you can be taxed on and thus make a significant saving on the cost of your new bike and/or accessories.
An up-to-date overview of rates of tax can be seen on the Government's website. However, to save you opening another tab we can confirm that normal rates of tax are 32% for a lower rate taxpayer and 42% for a higher rate taxpayer. This means that most scheme participants save between 32-42% on the cost of their bike and/or accessories during their initial hire period.
It's important to remember that the cost of the commuting package will always show up on your payslip as the gross (or RRP amount) rather than the net (or 'with-savings') amount.
An example of this is shown below:
It's also important to remember that an Ownership Fee will be due at the end of the Hire Period. This is to avoid tax liability and to ensure ownership of the bike is smoothly and effectively transferred from your employer to you.
Cyclescheme always recommends that employees choose our 'Own it later' option, as this ensures savings are protected and enables you to get another bike or accessories package if you wish. As the 'Own it later' option will cost either 3 or 7% of your packages original value your total savings will end up being between 25 and 39% depending on the cost of your bike and/or accessories and the rate of tax you pay.
Where can I shop with Cyclescheme?
Cyclescheme prides itself on being the cycle to work provider that has the broadest and deepest range of retailers and shopping options.
If you want the benefit of face-to-face service, head to a nearby Cyclescheme shop. If you already know what you want, or your local shop doesn't have what you are looking for, you might be better off looking online.
What can I get on the cycle to work scheme?
You can get whatever you need to keep you in the saddle and cycle commuting regularly. Including any type of bike, e-bike or cycle with at least 2 wheels.
The only cycle to work scheme exceptions are:
Everything else is allowable. For example:
Anything that is going to help you and your bike arrive at work (warm, safe and secure) are essentially allowable.
Cyclescheme offers three types of packages:
This means that you have the scope to get exactly what you need. Just decide what you want and where you want to shop OR how much you want to spend and make your application.
Can I participate in the cycle to work scheme?
To participate in the scheme you must receive your salary via the Pay As You Earn (PAYE) and be a working adult aged 16 or over. Your employer needs to be signed up and your earnings should be more than the National Living Wage (NLW) or National Minimum Wage (NMW) after the salary sacrifice is taken from your gross salary.
If you are paid on or near NLW/NMW, your employer will be able to offer an alternative means of applying to participate in the scheme and you will still be able to benefit through reduced cost of hire.
It is worth noting that there is no credit check if you wish to participate, and if you are under 18 you can join the scheme if your guardian signs a guarantor agreement. Being on probation should not affect your eligibility - if you are unsure, please check with your employer.
If you are not sure how to apply or what the next steps are, there's a bunch of useful information below:
I know my employer code
If you've decided on your dream cycle-to-work package, chosen a retailer and you're ready to roll - it's time to log in and apply. As you know your employer code, please enter it in the employer code box on our homepage then click 'Let's get started'.
I don't know my employer code
An employer code allows you to apply via your specific employer's scheme. You may not know your employer code for a few reasons...
Employer search tool
You can search for your employer by name on our homepage. If you still cannot find them your best bet is to ask your boss or HR contact or to contact Cyclescheme.
When it's time to pay the ownership fee what do the options look like?
We'll email or write to you when it's time to pay your ownership fee. We'll direct you to our quick and simple ownership options process.
Checking out is simple, you can pay by card or PayPal. Once you've checked-out we'll email you a receipt. If you choose the recommended 'Own it later' agreement, we'll stay in touch until the end of the extended use period (usually 4 years) and confirm when the Cyclescheme package becomes yours (assuming you don't wish to return it).
Do I have to ride to work everyday?
This is a common question and there's a simple answer and a technical answer...
No, you do not have to commute by bike daily.
How to join the cycle to work scheme
Tax is complicated; Cyclescheme is not. You choose a bike, hire it for an agreed length of time, then snap it up for a fraction of its original value. It's like a year-round sale, with interest-free credit available in over 2,000 retailers nationwide.
We’ve worked hard to provide a transparent and easy to understand process. There are just three steps to go through to get a bike for work through Cyclescheme.
1. Pick Your Package & Apply
Use our calculator to check how much you can save.
Once you have a budget in mind use our retailer finder to select a local store or online retailer to shop with. If you want, you can decide on your retailer after you've applied. If you're very price conscious check out our offers.
Remember, if you’re visiting a retailer they can give you expert one-to-one advice; if you shop online, do your research, check reviews and make sure you get your bike sizing correct.
2. Get Your Gear
This couldn’t be easier. If your employer is signed up with Cyclescheme, they’ll have a unique employer code to use when you apply via cyclescheme.co.uk (our homepage gives you the option to click on 'I'm an employee', once you've done this you can enter your employer name or code and apply). If your employer isn’t signed up, they can join for free in just a few clicks. You can invite them to join the scheme or point them to our employer registration process.
When you 'Apply', you’ll be guided through a simple form that asks for your work details (inc. payroll number), contact information, and the value of the Cyclescheme Certificate you’re applying for. If you've agreed to get your bike and/or accessories from a specific retailer you'll be able to link your request to them, but you can also decide on the retailer you want to use after you've applied by 'Deciding later'.
Your employer will review your application and pay for your Cyclescheme package. We'll then instantaneously send you an eCertificate which you can exchange for your gear in-store or online.
3. Choose an ownership option
When your Hire Agreement and salary sacrifice ends, you can keep your Cyclescheme package by paying a small ownership fee. There are 3 options, the price of our recommended option 'Own it later' is built into all our marketing communications and calculators and should not come as a surprise.
Own it later (recommended option)
For a Cyclescheme package under £500, you'll pay 3% of the original value; for a package over £500, it's 7% – so a maximum of £70 on a £1,000 package. The bike remains ‘hired’ for a further 36 months, but with no more monthly payments. Ownership can then officially be transferred to you at no extra cost.
This method of transferring ownership is why you save a minimum of 25% and a maximum of 39% (some may save more due to deals or offers).
Own it now
The 'Own it now' fee allows you to own the bike straight away, but it costs more. For a Cyclescheme package under £500, you'll pay 18% of the original value; for a package over £500, it's 25% – so a maximum of £250 on a £1,000 package. The bike is officially transferred to you at this point and there are no others costs.
There is little material benefit to choosing this option and we recommend that all Cycleschemers opt to keep their bikes by choosing the 'Own it later' fee.
Return the bike
If for any reason you do not want the bike at the end of the Hire Period you can return it to Cyclescheme and incur no additional costs.
What is an employer code?
A Cyclescheme employer code is a short alphanumeric code that allows you to log into your employer's customised version of the Cyclescheme website; it tends to look like 'fd45aq'.You use the code to log in on the Cyclescheme homepage. You do this by clicking on 'I'M AN EMPLOYEE':
And then pop your employer code in the 'Enter Employer Name or Code' box and hit 'LET'S GET STARTED':
What happens if an employee leaves their job or is made redundant?
Once signed, the Hire Agreement is non-cancellable following a cooling-off period of 14-working days following collection of the goods. This means that if an employee leaves or is made redundant from their employment during the hire period they are obliged to pay the remaining salary sacrifice amount in full from net pay i.e. without any tax exemptions.
How does salary sacrifice and the cycle to work scheme work for employers?
Cycle to work operates as a 'salary sacrifice' employee benefit. This means that the employee agrees to give up part of their salary in exchange for a benefit – in this instance the benefit is a bike and/or accessories. The salary sacrifice is taken from their gross salary (before tax) which means that the employee will pay less Income Tax and National Insurance (NI) and that the employer will reduce their National Insurance Contributions (NICs) bill.
The graphic below shows a comparison between the conventional way of getting a bike (or any commodity) and the tax-efficient way:
As you can see, by going down the salary sacrifice route the amount of income that can be taxed is lowered and thus a significant saving is generated.
An up-to-date overview of rates of tax can be seen on the Government's website. However, to save you opening another tab we can confirm that normal rates of tax are 32% for a lower rate taxpayer and 42% for a higher rate taxpayer. This means that most scheme participants save between 32-42% on the cost of their bike and/or accessories during their initial hire period
Employer savings relate to employer NICs rates can also be seen on the Government's website. Generally, employers contribute 13.8% to employee NICs and can, therefore, generate up to 13.8% savings on any funds processed via salary sacrifice. For example, for every £1,000 spent on the cycle to work scheme, the average employer will recoup £1,138 - it really is win-win!.
It's important to remember that the cost of the commuting package will always show up on employee payslips as the gross (or RRP amount) rather than the net (or 'with-savings') amount. An example of this is shown below:
It's also important to remember that an Ownership Fee will be due at the end of the Hire Period. This is to avoid tax liability and to ensure ownership of the bike is smoothly and effectively transferred from your employer to the employee.
Cyclescheme always recommends that employees choose our 'Own it later' option, as this ensures savings are protected and enables employees to get another bike or accessories package if they wish. As the 'Own it later' option will cost either 3 or 7% of the cycle to work packages original value the total savings will end up being between 25 and 39% depending on the cost of the bike and/or accessories and the rate of tax the employee pays.
How to implement a salary sacrifice:
Because there are some many types of payroll platforms, we do not offer advice on exactly how to apply a salary sacrifice agreement to a member of your workforce.
However, salary sacrifice is ubiquitous in the accounts and payroll world and your finance team, payroll team or financial advisor will be able to organise this for you. It's usually the work of a moment.
Can self-employed people join the cycle to work scheme?
You are able to sign-up as an employer and participant with Cyclescheme as long as you receive a salary through the Pay-As-You-Earn (PAYE) system.
You can’t take part in Cyclescheme if you’re a sole trader. As a sole trader, you pay income tax and National Insurance once a year under Self Assessment, the amounts being based on your profits. You don’t pay tax and National Insurance through PAYE because you don’t receive a salary as such. Without a salary to sacrifice, you can’t take part in a salary sacrifice scheme like Cyclescheme. The exception would be for a sole trader who had a second job that did pay a salary.
You can take part in Cyclescheme if you run your own limited company as a director, even if you’re the sole employee. With a single-person business like this, you’ll typically pay yourself a minimal salary through PAYE and take the bulk of your income as dividends. Probably the salary you pay yourself is at or even below National Minimum Wage; unless you have a contract of employment with your own company, which is unlikely, you are exempt from National Minimum Wage (NMW).
To be eligible to take part in Cyclescheme, you’ll have to pay yourself differently. You’re an employee of your company, and as with anyone on low wages, you must be earning NMW after any salary sacrifice payments. So you must pay yourself NMW plus the value of the salary sacrifice you’ll be making.
Your director’s salary will thus be larger in your annual accounts. You’ll still draw down dividends, but your administrative expenses will be larger by the increase you make in your director’s salary.
If in doubt, chat to your financial advisor.
Who actually owns the cycle to work bike?
Since June 2019 when the Department for Transport (DfT) updated the Cycle to Work Scheme Implementation Guidance Cyclescheme has operated two versions of our Hire Agreement.
We do this depending on whether or not an employer is operating the scheme using the blanket FSMA Order exemption (which allows employers to operate the scheme up to a limit of £1,000) or Cyclescheme's FCA Authorisation (which enables employers to operate a version of the scheme where they can offer 'no limit' schemes or schemes with limits over £1,000).
Traditional Hire Agreements
(where employers are using the FSMA exemption)
The bike and/or accessories remain the property of the employer throughout the hire period.
Freedom to Ride Hire Agreements
(where employers are using relaying on Cyclescheme's FCA Authorisation)
The bike and/or accessories become the property of Cyclescheme and remain Cyclescheme's property throughout the hire period.
What's the end-to-end process for setting up and running a cycle to work scheme?
Setting up and running a cycle to work scheme is easy.
This is because Cyclescheme is easy to set up and simple to use.
The end-to-end process for setting up Cyclescheme:
How does the cycle to work scheme work for employers?
The cycle to work scheme allows employees to obtain commuter bikes and cycling accessories through their employer, whilst spreading the cost over 12 months and making unbeatable savings through a tax break.
Cyclescheme makes the implementation, coordination and administration of the cycle to work scheme a doddle.
Cyclescheme in 3 easy steps:
The cycle to work scheme savings:
What is the maximum certificate value employees can select through the cycle to work scheme?
Employers can implement Cycle to Work schemes and offer a maximum certificate value of £1,000 inc. VAT per employee, thanks to a Cycle to Work exemption issued by the Financial Conduct Authority (FCA).
Cyclescheme can also enable employers to offer 'no limit' schemes via our 'Freedom to ride' program.
'Freedom to ride' is Cyclescheme's normal scheme for all employers that have registered on the scheme since 2nd of October, 2019.
Employers who have the appropriate Consumer Credit Authorisation from the FCA can also allow employees to request Certificates of a higher value.
When an employer has a limit over £1,000, their employees can enjoy the Income Tax and NIC benefit for the full value of the equipment they obtain and the employer will also benefit from increased employers' National Insurance Contributions (NICs) savings.
What are the savings for the employee and employer?
Typical savings for employees are a minimum of 25% for a standard rate taxpayer, assuming that Cyclescheme's convenient ownership solution is applied, but the actual amount depends on the employee’s personal tax band and the way the employer runs their scheme. If the employer uses external finance (i.e. borrows the money to buy the bikes from an outside agent) then savings will be approximately 5% lower.
See below for some example employee savings based on a lower rate taxpayer (32%):
See below for some example employee savings based on a higher rate taxpayer (42%):
Employers can typically save 13.8% of the total value of salary sacrifice, due to reductions in employers’ National Insurance Contributions (NICs).
See below for some example employer savings:
What is the cycle to work scheme from an employers perspective?
The cycle to work scheme is a tax-efficient employee benefit that helps working adults save money on a new bike and/or cycling accessories. The scheme enables riders to save 25-39% on all their gear (or even more with 'Cyclescheme offers' or Cyclescheme 'no-quibble' retailers).
The scheme is born from the Government's 'Green Transport Plan'. The plan aims to reduce congestion and emissions in our cities whilst also encouraging healthier, happier commutes. It encourages working adults to swap their car commute for a cycling one, and as an incentive, riders benefit from a tax exemption on the cost of their cycle commuting goods.
Cyclescheme is the UK's most popular cycle to work provider, creating and supporting more cyclists than any other UK based cycling organisation. To date, Cyclescheme has supported over 800,000 cyclists in starting or sustaining their cycle commute.
The video below gives a simple overview of how the scheme works:
Who is Cyclescheme?
Cyclescheme is the UK’s leading provider of tax-free bikes for the Government’s cycle to work initiative.
Cyclescheme gets more adults cycling than any other UK organisation
It’s a brilliant programme where everyone wins – employees make big savings on new bikes and/or accessories, whilst you get a healthier, more motivated workforce and enjoy significant National Insurance Contribution (NIC) savings.
Cyclescheme works with over 2,000 retailers that consistently offer expert, convenient and user-friendly service to Cycleschemers. Employees can shop in-store, online, click and collect or brand direct.
Services to employers are provided completely free-of-charge and include secure access to a scheme management website called, MySchemes. This online account gives you access to all your paperwork, a range of free marketing tools and also access to other benefits including Techscheme.
Any size of scheme is catered for and we have a well-established reputation for fast and efficient service.
What makes Cyclescheme the leading provider?
Cyclescheme is part of the Blackhawk Network group. The group has expertise in employee and consumer engagement and incentives, retail, themed gift cards, and offers physical and digital solutions.
Other Blackhawk employee benefits products include:
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