Health & Transport
Cycle to Work Scheme Guidance
The recent national Bike Week (w/b 19th June) will have served to raise awareness of the benefits of cycling and to help support staff who wish to cycling to work the Department of Transport operate a scheme that for employers to subsidies the cost of buying new bikes for staff.
To promote healthier journeys to work and to reduce environmental pollution, the 1999 Finance Act introduced an annual tax exemption, which allows employers to loan cycles and cyclists’ safety equipment to employees as a tax-free benefit. The exemption was one of a series of measures introduced under the Government’s Green Transport Plan. The following guidelines clarify how organisations can take advantage of the exemption to implement a Cycle to Work scheme that encourages employees to cycle to work and allows employers to reap the benefits of a healthier workforce.
These notes are for guidance only and reflect the tax position at the time of writing and the law as it relates to the provision of consumer credit. The tax exemption refers to cycles and cyclists’ safety equipment loaned to employees by employers. However, where salary sacrifice arrangements are used, Cycle to Work schemes must be regulated hire agreements between the employer and the employee. The terms ‘hire’ and ‘loan’ are therefore both used in these guidelines.
The following guidelines clarify how organisations can take advantage of the exemption to implement a Cycle to Work scheme that encourages employees to cycle to work and allows employers to reap the benefits of a healthier workforce.
Download Cycle to Work Scheme implementation guidance (PDF - 200 KB)
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To order printed copies please contact DfT Publications. Telephone 0300 123 1102.