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Tax-Free Bikes at Stows Cycles

Tax-Free Bikes

Tax-free bikes for work save you up to 42% on bikes and equipment. The Government's Green Transport Plan provides a tax exemption that allows employers to provide cycles to employees as a tax-free benefit. Cycle to Work schemes have been set up that carry out the administration on behalf of participating employers. Importantly - the bike does NOT have to be just for work.

Each scheme, whether it's managed through a third party or managed by the employers payroll department, will result in significant savings on the purchase of new a new bike and equipment - as the payments are taken from your pre-tax income.

The most widely used scheme is Cyclescheme, which operates through independent cycle retailers. Other schemes in which we participate are CyclePlus, Bike2Work Scheme, Halfords cycle2work, Bikes for the NHS, and SalaryExchange. Please follow the links below to check how much you can save with the schemes' online calculator. A £1,000 limit is typical on most schemes (above this amount the employer must have a consumer credit license), but you can pay the extra on top of £1,000 for a more expensive bike.

The savings come from the employer reclaiming the VAT and then leasing the bike to the employee for a fixed term, normally 12 months. The monthly lease amount is taken from the employee's pre tax pay resulting in a tax saving in the employee's take home pay packet. The employee must have a permanent position, pay tax under PAYE, be aged 18 or over, and earn more than the national minimum wage once the bike payments have been deducted from the gross salary.

All schemes charge us a commission. That is how they make their money, so it will not be possible to offer schemes on clearance items or run schemes in conjunction with loyalty cards. However, it may make sense for you to pay the commission cost if you wish to buy a sale or clearance item, as you will be more than compensated for that in your overall tax saving.

If you have any questions at all please contact us for more information. We are also more than happy to come to the workplace and demonstrate bikes and talk to your HR department about the benefits of joining one of the schemes.

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