How does the Cycle to Work Scheme work?

Under the Government's Green Transport Plan registered employers are allowed a tax exemption which enables them to provide bikes and safety equipment to employees as a tax-free benefit.

The employer buys the bike and safety equipment at the retail price.

The costs are then recovered from a reduction in the employee's gross salary (salary sacrifice). Employees hire the bike from their employer with the option of buying it at the end of the salary sacrifice period for a fair market value payment.

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