Cycle to Work - FAQs - Does the 2024 VAT Update Impact the Repayments That the Employee Is Required to Repay to the Employer? (for UK only)

No, the VAT update does not affect the monthly repayments as the employee's agreement before and after the change is the same. They applied for the cost of the bike previously £1,000 (which incurred VAT for the employer) and they repaid them £1,000.  Now, the cost of the bike is still £1,000, and therefore, they repay their employer £1,000.  The difference is that there is no VAT to the employer - it is just included at the till.