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The Cycle to Work Scheme is a tax incentive scheme that aims to encourage employees to cycle to and from work. Under the scheme, employers can pay for bicycles and bicycle equipment for their employees and the employee pays back through a salary sacrifice arrangement of up to 12 months. The employee is not liable for tax, PRSI, levies, or the Universal Social Charge on their repayments.
Usually, your employer pays the supplier for the bicycle and sets up a ‘salary sacrifice’ arrangement from your salary over an agreed time frame (no more than 12 months). This generally means that you visit the shop, select the equipment you wish to buy and have the shop invoice your employer directly for the cost. Note that the tax exemption does not apply if you pay for the bicycle and are reimbursed by your employer.
The repayment for the bicycle and equipment is then deducted from your gross salary (this means before income tax, PRSI, pension levies, or Universal Social Charge are deducted). These deductions can be made weekly, fortnightly, or monthly depending on your salary payment arrangement. Your employer can also buy the bicycle on your behalf and not require you to pay for it.
You can only avail of the scheme once in a 4 year period. This amount will increase to €1,250 in respect of bicycles and €1,500 in respect of ‘e-bikes’ as part of the Government’s Jobs Stimulus Plan.
You must use the bicycle and safety equipment mainly for qualifying journeys. This means the whole or part (for example between home and train station) of a journey between your home and your normal place of work. Employers do not have to monitor this but you will be asked to sign a statement saying that the bicycle is for your own use and will be mainly used for qualifying journeys.
There is a limit of €1,250 in respect of bicycles and €1,500 in respect of ‘e-bikes’ as part of the Government’s Jobs Stimulus Plan. (this includes bicycles, safety equipment, and delivery charges). If you spend more than this limit you are liable for a benefit-in-kind income tax charge.
Check if your employer will take part in the scheme. If they will, come to LK Bikes and pick out your bike and anything else you want.
Using our service for the Cycle to Work scheme, your company can purchase a brand new bike and safety equipment worth up to €1,250 tax free for regular bikes; or €1,500 for electric bikes for your employees. You recover the cost of the bike from the employee using Salary Sacrifice. This means that the employees save up to half of the retail price of bikes and equipment, and your company also makes a saving of 10.75% on Employers' PRSI contributions.
Bike to Work Ltd is an independent company created to help both employers and employees take advantage of the Cycle to Work and Travel Pass schemes and the associated tax benefits of the schemes.
BiketoWork use our industry experience and trade contacts to encourage employees to avail of the cycle scheme on a bike of their choice from their local participating bicycle shop.
BiketoWork handle the majority of the administration for the employer at no charge, and provide a single point of contact for enquiries and invoices. All this while maintaining the best choice of bikes for employees.
For larger companies BiketoWork can visit your company to help employers promote the Cycle to Work Scheme. This involves BiketoWork visiting work locations to advise staff on how the cycle to work scheme works and show the types of bikes on offer under the scheme.
Email: [email protected]
Phone: (074) 912 6728