Cycle to Work is part of the Government's Green Transport initiative and is a 'salary sacrifice' benefit that HR can offer to enable their staff to save money on bicycles and cycle safety accessories. These savings come from the fact employers won’t pay tax or National Insurance (NI) contributions on the value of the salary they exchange for vouchers.
Tax savings
The most obvious benefit for employers for any salary sacrifice scheme is the tax savings they can obtain for their organisation. Many employers use these savings to fund other benefits or HR programmes.
We have saved our clients a total of over £2.5 million in the 8 years we've provided Cycle to Work. Here are some examples of exactly how much clients can expect to save.
|
|
100 | 250 | 500 | 1000 |
Scheme take up (5%) |
5 employees | 13 employees | 25 employees | 50 employees |
Average bike value |
£600 | £600 | £600 | £600 |
Total scheme invoice |
£3,000 | £7,800 | £15,000 | £30,000 |
Total NI Saving for the business |
£414 | £1,076 | £2,070 | £4,140 |
(Assumes NIC at 13.8% x £600 x Scheme Take Up)
Low cost, popular benefit
The cost to the employer for running a Cycle to Work programme is minimal to negative, which means they can add it to their benefits offering and boost their EVP easily and cheaply.
Additionally, the nature of the benefit helps employers attract and retain a healthier, greener and more productive workforce.
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