Policy overview
A tax-free bikes-for-work scheme is a Government-led initiative. It supports green travel to work and environmental issues.
The scheme lets employees save money on bikes and equipment through salary sacrifice. They do not pay income tax or National Insurance contributions on the deducted part of their salary.
We use the Halfords Cycle2Work scheme. Employee benefits include:
- reduction of carbon footprint
- saving 32% to 42% of a new bike and safety equipment
- spreading the cost of a new bike and safety equipment over a year
- saving money on income tax and National Insurance contributions
- improving fitness
- a choice from hundreds of brands from UK partner stores
Cycle2Work is governed by HMRC and is open to all employees who:
- are aged 18 or over and have a contract which outlasts the hire agreement
- agree to use the bike or equipment mainly for commuting
- are paid by LCC payroll
- earn over the minimum wage after deductions
- receive an income over the minimum tax threshold
School employees can join if their school has a Direct Service Agreement (formerly buy-back) with us for a Serco payroll service.
If the school's position is unclear, employees should ask the school's finance administrator or email employeebenefits@lincolnshire.gov.uk.
How does the scheme work?
- An employee signs up to a cycle hire agreement
- They choose a cycle and cycle equipment to the value of between £100 and £2,000
- Instalments are deducted directly from their gross salary
- At the end of the hire agreement (usually 12 months), the employee may take ownership of the cycle at fair market value. Alternatively, they can extend their hire period at no cost, subject to a separate agreement
Although you may use the bike for leisure, you must mainly use your bike for commuting to and between workplaces. This means that you must use your bike for at least half of your commuting journeys. For example, if you work 2 days in the office and 3 days at home you must use your bike to get to work on average at least 1 day per week over the year.
Further details
For more information about the application process, visit the intranet or email employeebenefits@lincolnshire.gov.uk.
