Sorry. You need to upgrade your browser

You are using Internet Explorer 8

This is considered an out of date browser. This website has been developed with modern browsers in mind to allow it to display at its best in a wide variety of viewing situations - including mobile viewing. But we haven't supported older browsers like IE8. Please upgrade to the latest version of Internet Explorer - or try Mozilla Firefox or Google Chrome. Both are excellent browsers.

Thank you.

Chartered Certified Accountants
and Business Advisors

01530 267320

Cycle to work scheme

The cycle to work scheme allows your business to provide employees, including directors, with the loan of a bicycle and cycling equipment, but without it counting as a taxable benefit-in-kind. The conditions are that:

 

  • All your employees must be offered availability to a bicycle.

  • They must not own it.

  • They must mainly use it for commuting.

 

HMRC takes a relaxed approach to the last condition and doesn’t expect you or your employee to keep any sort of record of usage.

 

There are now ready-made cycle schemes that you can search online. This works by a scheme provider owning the bicycle and equipment and hiring them out to you as an employer, and in return you make them available to all staff. The provider will even give you the hire contract required to give to your employees.

 

The price of the bicycle is not capped by the tax exemption; however, the Office of Fair Trading says that any hire agreement for the use of one is covered by the Consumer Credit Act 1974. To prevent each scheme having to apply for a consumer credit licence, they have created a group one which automatically covers the hire or loan of bicycles provided under the scheme where the value is less than £1,000.

 

As an alternative, if your business buys bicycles and makes them available to employers and directors, without a hire or loan contract, then the exemption applies without the consumer credit problem or price cap. You can reclaim the VAT and the remaining cost if the bicycle qualifies for a capital allowance deduction is equal to 19% of the cost.

18 Jun 2018

« Back to latest news

Latest news

Rent a room scheme

One way many people improve their bank balance is to rent out their spare room! By signing up to the Rent a Room scheme,...

Click to read more >

VAT on E-Books

Currently, electronic books are subject to members states’ higher standard VAT rates. However, their printed versions ...

Click to read more >

How can we help?

 

Submit

Testimonial

Sence are approachable and happy to take my call, they listen to me, and my concerns no matter how small.

Jacqui Williams
Tip Top Hair Design

Click to read the full testimonial >