Cycle to Work Scheme: Who Qualifies and What You Get

The Cycle to Work Scheme allows you to purchase a bicycle and related safety equipment using pre-tax salary.

👤Who it's for

This scheme is specifically designed for employees. To be eligible, you must work for an employer that has chosen to participate in the program. If your employer does not participate, you cannot access this specific tax-saving benefit.

🎁What you get

The primary benefit is the ability to acquire a bicycle and various pieces of cycling equipment through a tax-free purchase. This can include items needed for your commute or for general cycling, such as helmets, lights, or other essential gear. By using this scheme, you are able to acquire these items without paying the usual tax on the portion of your income used to pay for them.

💰What it costs you

The cost is handled through a method called salary sacrifice. Instead of paying for the bike out of your take-home pay after you have been taxed, the amount is deducted from your gross salary. This means the cost is spread out over a period of time, specifically 12 months. Because the money is taken before tax is calculated, it reduces the total amount of income you are taxed on, which helps manage the overall cost of the equipment.

⚠️The catch to know

There is one important detail regarding ownership to keep in mind: because the equipment is being paid for through your salary via a repayment period, you do not technically own the bike until the end of the term. You are essentially paying for the item through your monthly salary deductions until the full amount is covered.

📝How to apply

1. Check with your employer or your HR department to see if they participate in the scheme.
2. Once confirmed, select the bicycle and the specific pieces of equipment you wish to acquire.
3. Follow the application process provided by your employer's chosen provider to arrange the salary sacrifice.
4. Visit the official portal for more details: https://www.cyclescheme.co.uk/