The Cycle to work Scheme

Cycle to Work Schemes

I was promoting cycle to work schemes at the hospital the other week. They could use some further explanation I think. Firstly your employer has to be signed up with one of them before you can benefit. If they aren't ask them to, its not hard. In Harrogate the Hospital and North Yorkshire County Council are signed up and if any other employers want me to publicise their participation let me know, I will be happy to.

How it works

You find a bike you want up to the value of a £1000 this can include accessories like locks and helmets too. You have to use participating stores but there is usually a good range including online outlets. You tell your employer and the bike shop  what you want they arrange a "certificate" you drop it off at the bike shop and you get a bike.

You then pay for the bike, usually 12 payments over a year that come out of your salary before tax and national insurance. It's what is called a salary sacrifice scheme. At the end of the scheme you pay one more payment typically half of the monthly cost and the bike is yours in another two years, on paper it belongs to the scheme for these two years but you still get to ride it. Well you have other options actually, like having another bike using the scheme and handing the first one back. Or paying more to own the bike outright after a year. The details vary slightly scheme to scheme but that is the broad thrust.

Can I use it in my own time?

The scheme is about getting people to cycle to work but nobody is checking, if you ride the bike at other times nobody really minds. If you want a mountain bike that's fine too.

How much can I save?

Depends how much tax you pay but a basic rate taxpayer could save roughly 29 %, top rate taxpayers more. This is not completely free money as you pay less pension (if you are lucky enough to have one) as the bike money is deducted first, but its is the next best thing and you get a bike.

Some Thoughts

I looked at using the scheme when I worked at the Grammar School but decided that I could pick a bike up cheaper in the end of season sales as most shop worked on RRP's when using the scheme. As bike shops get ready for next years models it is not unusual to see discounts of up to 40% especially if you are an unpopular male size or a women.

However  I have just found these people Eureka cycle sports who will do the scheme on sale bikes with a 12% surcharge as there are some costs to them for administering the scheme. Now that is looking like a winner to me if I'm looking to get a bike.