How the Cycle to Work Scheme operates:
- In a nutshell the scheme works by allowing Employers to buy a bike and related accessories from an approved supplier up to a value of €1,000 on behalf of an Employee which is then repaid through salary sacrifice over a period of up to 12 months.
- Expenditure up to this amount will be exempt from PAYE, PRSI, or income levy charges, a potential saving of up to 52% depending on the applicable personal tax bands.
- The exemption is limited to the first €1,000 – with the employee paying the balance personally.
- Employees can only avail of this scheme once in every 5 years i.e. even if you purchase a bicycle or bicycle safety equipment for less than €1,000 in year one, you cannot claim an exemption in respect of the balance.
- Employers will benefit in a number of ways, namely through savings of 10.75% in Employer PRSI, but also from a greener corporate image & a healthier, happier workforce!
In terms of administering the scheme, your Employer will either pay the bike shop directly through cheque or bank transfer or choose to use a voucher company to administer the scheme - simply check with your HR department to determine what their procedure is. We are set up to cater for every payment method there is, so we can get you rolling on your tax free bike in no time!