Tax Free Bikes Under the Government’s Green Transport Plan there is an incentive which allows employers to provide bikes and safety equipment to empoloyees tax free. The way this works is:

• The employer buys the bike and equipment on behalf of the employee.
• The employee then rents this from the employer, with the option to purchase at the end of the rental period.
• The rent paid is deducted by the employer directly from the employee’s gross earnings which means a reduction in Income Tax and National Insurance.
• The effective result of this is that the employee gets the bike and safety equipment tax free.

The saving to each employee is dependent on their personal Income Tax rate and the VAT position of the employer. The actual savings available are as follows:

• A basic rate tax payer employed by a non VAT registered company saves 31%
• A basic rate tax payer employed by a VAT registered company saves 41%
• A higher rate tax payer employed by a non-VAT registered company saves 41%
• A higher rate tax payer employed by a VAT registered company saves 50%

A £1,000 limit has been set by the Government for each individual employee unless the employer has a Consumer Credit Licence in which case there is no limit.

There are various companies which offer advice and administrative support for the provision of bikes under the Government incentive of which Common Assault is currently partnered with two. These are CycleScheme, which is the biggest provider in the UK, and Bikes for the NHS, which provides a service specifically for NHS employees including local surgery staff, partamedics and hospital employees.

Further information regarding the Green Transport Plan and the tax benefits can be found at the following websites:

www.gov.etc
www.hmrc.etc

Information for regarding Cyclescheme and Bikes for the NHS can be found at:

www.cyclescheme.co.uk
www.bikesforthenhs.co.uk

Alternatively please give us a call at the shop and we will be happy to give you as much assistance as we can.