Cycle to Work Scheme: Your Guide to Sustainable Cycling and Savings

In an effort to encourage healthier lifestyles and reduce environmental pollution, the UK government introduced the Cycle to Work Scheme over two decades ago. This initiative has flourished, becoming an essential component of the UK's approach to sustainable transportation and wellness.

Annually, it supports hundreds of thousands of employees in acquiring bikes and cycling equipment tax-efficiently, thus making cycling an attractive and affordable option, promoting cycling as a cornerstone of urban mobility.

UNDERSTANDING THE CYCLE TO WORK SCHEME

The Cycle to Work Scheme is a government initiative designed to make cycling more affordable and accessible for employees. Through this scheme, employees can save up to 42% on the cost of new bicycles and cycling equipment by purchasing them tax-free. This is achieved by the employer purchasing the bike and equipment on behalf of the employee, who then leases it back through salary sacrifice over a period, typically 12 months. After this period, the employee has the option to purchase the bike at a fair market value or extend the lease.

This scheme operates under a straightforward premise: by reducing the financial barrier to cycling, more individuals will be motivated to switch to this eco-friendly mode of transportation. The popularity of the scheme is evident in its usage, with over 1.6 million people in the UK participating annually, highlighting its significant impact on promoting cycling.

FINANCIAL BENEFITS ACROSS INCOME TAX BANDS

The Cycle to Work Scheme offers substantial savings, particularly beneficial for those in higher income tax bands. For example, a standard rate taxpayer can save 32% on the cost of a new bike and accessories, while a higher rate taxpayer can save 42%. These savings are a result of the scheme's structure, which allows the cost of the bike to be deducted from the employee's gross salary, thereby reducing the amount of income tax and National Insurance contributions payable.

For a high-quality bike valued between £5,000 and £7,000, the financial benefits become even more pronounced. Assuming a repayment period of 12 months, a higher rate taxpayer would see typical monthly repayments significantly reduced, making a top-tier bicycle much more accessible. The exact savings and monthly repayments would depend on the individual's tax situation and the scheme's specifics as offered by their employer.

To make a cycle to work saving there are a plethora of providers who will do much of the work for often stretched HR departments, or alternatively companies can run the initiative themselves by following government guidelines.

ADVANTAGES OF HIGHER QUALITY BIKES

Investing in a higher quality bike comes with a plethora of benefits. Typically mid to high end bikes are not only more durable and reliable but also offer a better riding experience. They are usually lighter, with superior components that ensure smoother gear shifts, more effective braking, and overall improved performance. This can make a significant difference for daily commuters, making their ride more enjoyable and less physically taxing, thereby encouraging sustained cycling habits.

THE PEARSON ADVANTAGE

Founded in 1860, Pearson is recognised as the world’s oldest cycling company, with a rich heritage in producing high-quality bicycles. A Pearson bike is not just a mode of transport; it's a personal statement crafted with expertise and attention to detail.

One of the unique aspects of purchasing a Pearson bike is the custom element. Each bike is tailored to the individual, ensuring a perfect fit and an optimised riding experience. This bespoke service means that each bike is handbuilt with care and precision, typically in under 14 days. This level of customisation and speed of production is unusual in the industry, whilst also offering customers exemplary service without the lengthy wait times often associated with custom bikes.

ENVIRONMENTAL AND HEALTH BENEFITS

The Cycle to Work Scheme offers significant environmental and health benefits. Cycling reduces the reliance on motor vehicles, leading to lower carbon emissions and contributing to cleaner air in urban areas. From a health perspective, even a 20 minute journey can improve cardiovascular fitness, muscle strength, and mental well-being, reducing the risk of chronic diseases associated with a sedentary lifestyle. 

SUMMING UP...

The Cycle to Work Scheme is a vital component of the UK's strategy to promote sustainable transportation and enhance public health. By offering substantial savings on the purchase of new bikes and equipment, it makes cycling a more attractive option for commuting and leisure.

The scheme's benefits are magnified when investing in a higher quality bike like those offered by Pearson, which combine performance, durability, and a personalised riding experience. Through this initiative, individuals can enjoy the myriad benefits of cycling, from improved health and reduced environmental impact to financial savings, making it an appealing choice for commuters across the UK.

Read next - The Pearson Bike Building Process >

.