Getting To Know How The Cycle To Work Scheme Operates
Whether you are an employer or an employee, participating in the cycle to work scheme may prove to be advantageous for you
. Part of the Green Transport Plan
implemented by the Government, the
HMRC cycle to work scheme aims
to provide employees with cycles to commute to and from work.
Before you implement this scheme in your organisation or participate in the one available from your employer, it is necessary to have an idea about how
this works. Here is a quick look at the steps involved in the process:
The employer needs to participate in the scheme. For this, a working agreement with a registered bicycle supplier is necessary. Finding the right supplier
is essential at this stage. You would purchase the bicycles and the necessary safety equipment from this supplier. It is, therefore, necessary to choose a
supplier that offers quality products and high-standard services at reasonable rates. Opting for a supplier who operates a number of cycle shops makes it
easier to get the necessary products at the right time.
As per the implementation guidelines, this scheme needs to be open to all employees of the organisation, even for the employees who do not qualify for the
salary sacrifice arrangement. Each employee may have the opportunity to choose the bicycle and cycling equipment within the limit specified by the employer.
On the other hand, the employer may provide a certain number of cycle and cycling gear options from which the employee needs to choose a particular one.
After the employee chooses the bicycle and accessories, the supplier provides the details of the package to the employer. It is the responsibility of the
employer to make the purchase. The package is delivered to the employee directly. The employee agrees to a salary sacrifice to pay for the use of this
privilege through the hire period. As per this plan, the employee agrees to forego part of their weekly or monthly salary every pay period to settle the cost
incurred by the employer in making the purchase.
Participating in the
bike to work scheme Northern Irelandoffers tax benefits for both the employers and
employees. The bicycle and cycling equipment are exempt from taxes and levies. There is no necessity to pay the PRSI on these as well. Moreover, this scheme
provides you the opportunity to contribute to the conservation of the environment. Cycling to work reduces carbon emissions, and is one of the significant
eco-friendly ways to travel to and from office.
What happens to the bicycle and the cycling equipment at the end of the hire period? The answer to this depends on the plans of the employer. The employer
may consider giving you the bicycle and the equipment at the market value at the end of the period. The bike supplier may also let the employee use the
bicycle for an extended period for a small refund. Determine this before you agree to participate in this scheme.
by: Daniel Smith
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