Enhanced cycle arrangements for employees

For a number of years many organisations have provided bicycles for employees to travel to and from work and these arrangements have become increasingly popular as more and more employees have taken up cycling as a way of improving fitness whilst also reducing carbon emissions.

The UK tax system has supported these initiatives by allowing employers to provide bicycles to Directors and employees free of tax — in other words with there being no “Benefit in Kind” tax charge levied on the employee for having use of a bicycle owned by the employer.

Unfortunately, understanding of this generous tax exemption has become increasingly muddled in recent years as employers, employees and indeed third party providers have confused the requirements of the tax legislation with Consumer Credit Licensing rules. As a result, most arrangements in place restrict employees to cheaper bicycles which do not provide the more serious cyclist with everything needed for travelling longer distances.

Cobia is a specialist Employment Tax business and in response to this challenge has designed arrangements which:

• Removes any upper ceiling costs offered by the majority of external schemes; whilst
• Still providing a benefit which is exempt from tax and National Insurance.

Example of enhanced cycle arrangements for employees

Enhanced cycle arrangements offer a genuine opportunity for employers to assist with the genuine costs of the more serious cyclist but care must be taken to ensure that all tax, National Insurance, Employment Law and Consumer Credit laws have been considered.

Cobia is an Employment Tax specialist and would be happy to discuss these arrangements with you in more detail and tailor arrangements which fully meet your requirements.

Should you have any queries or would like to speak with one of our team about your specific circumstances then please click here or call us on
0845 226 0580. Alternatively, you can email info@cobia-uk.com for more information.