How do I return my bike?
If you do not wish to take ownership of the Equipment or sign the Extended Use Agreement you must return the bicycle to Cycle scheme Ltd. You need to inform Cycle scheme that you wish to return the bicycle by writing to us at the below address:
Cycle Scheme Ltd
PO Box 3809
Bath, BA1 1WX
You must inform us of your intention to return the bicycle.
Once we have received written notice of your intention to return the bicycle, Cycle scheme Ltd will contact you with further instructions. Whilst Cycle scheme Ltd will not charge for disposal of the bicycle, you will be required to deliver or post the bicycle and are responsible for any financial cost in doing so. Once the bicycle has been received and verified as the original hired equipment you will be contacted with an acknowledgment of receipt and no further correspondence will be sent to you.
If you do not inform us of your intention to return the bicycle, this would result in a benefit in kind that should be declared on a P11D which may result in any tax savings, made during the hire period, being disallowed. Furthermore, you will be responsible for paying the Cycle scheme Ltd any costs that we reasonably incur in recovering the bicycle from you.
What is the maximum value bicycle and safety equipment package employees can select through the scheme?
The Office of Fair Trading (OFT) has issued a group consumer credit license to cover Employers implementing Cycle to Work Schemes that are limited at £1000 inc. VAT per Certificate. To view and download a copy of the license please clicks here.
Employers who have their own Consumer Credit License Category B (consumer hire) can allow employees to request Certificates of a higher value. Alternatively, employers wishing to increase the Cycle to Work Certificate value can apply for their own individual Consumer Credit License from the Office of Fair Trading. For further details please contact our Helpdesk on [email protected]
Does the bike have to be used for commuting?
Employees should use the bike mainly for commuting to and, if relevant, between workplaces (at least 50% of the bike’s use should be for work purposes). However, the bike can also be used for non-work purposes and there is no need for employers to monitor individual usage or for employees to keep a mileage log. Please note that employees cannot claim business mileage allowance with a bike that is being hired to them by their employer.
What happens at the end of the hire period?
In order to preserve the tax benefits of the scheme, there can be no guarantee or obligation to transfer ownership to the employee immediately after the hire period has ended. However, employers generally choose to offer this option in addition to others, either directly or via the Cycle scheme.
At the end of the hire period, the Cycle scheme will contact employees to discuss the options available.
The most attractive option for employees will be to pay a small, refundable deposit (3% or 7% of the equipment value*) and continue to use the bicycle for an extended period of up to 36 months.
At the end of this period, if the employee does not wish to keep the bicycle, then Cyclescheme will refund the deposit in full. Alternatively, the Cycle scheme may at its discretion, offer ownership of the bicycle to the employee at this point, and no further action or payment will be required if they wish to keep the bicycle.
For more information, please refer to the article ‘HMRC Market Value Clarification‘ in our ‘Employer Updates’ section.
* The lower figure is for an equipment value of less than £500 and the higher one for equipment value of £500 or more. These figures include VAT.
What happens if an employee leaves their job or is made redundant?
Once signed, the Hire Agreement is non-cancellable following a cooling-off period of 7 working days following the collection of the goods. This means that if an employee leaves or is made redundant from their employment during the hire period they are obliged to pay the remaining salary sacrifice amount in full from net pay i.e. without any tax exemptions.
For further information please see the Department for Transport’s Cycle to Work implementation guide: