Cycle to work

We are cycling loving accountants, so we encourage all to take advantage of the tax exemption for bicycles on the Cycle to work scheme.

Cycling to work scheme

Cycle-to-work exemption allows your business to provide employees, including directors, with the loan of a bicycle and cycling safety equipment, but without it counting as a taxable benefit in kind. 

The main conditions are that:

  • all your employees must be offered availability to a bicycle
  • they must not own the bike, it is owned by the business
  • they must mainly use the bike for commuting and business travel.

In practice, HMRC does not expect you or your employees to keep a record of use.

Please note. You do not have to use a ready-made cycle-to-work scheme to take advantage of the tax and NI exemption. Although, you might get a different impression from the cycle-to-work scheme websites.

If your business buys bicycles and makes them available to employees and directors, without a hire or loan contract, the exemption applies without the consumer credit problem or £1,000 price cap.

For example, you can buy a road bike costing £2,000, reclaim the VAT and the net amount qualifies for capital allowances to reduce the company corporation tax bill.


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