cycle to work information pack ~ evans & halfords
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Cycle to Work SchemeInformation Pack
Employee Guide
Your employer is taking part in the Government’s Cycle to Work scheme, which can save you up to 42% of the retail value of a bicycle and accessories (depending on your tax bracket).
If you wish to join the scheme, follow the Getting Started guide on the following page.
You will be able to choose between Halfords or an Evans and once you have completed the application process you will receive a voucher via email for your chosen value, up to £1,000. You can use your voucher to purchase both a bicycle and safety equipment
You will pay for the bicycle and accessories in easy installments, through payroll, over a 12 month period. The installments will be deducted from gross pay, not net pay, which means you save tax and national insurance on the value of the bike and accessories.
Example Savings
Cycle to Work Helpline 0800 652 4745
Save up to42% off a new bike!
Example: Retail value of Bicycle and Accessories
Cost to you * Basic Rate Taxpayer
Assuming: Higher Rate Taxpayer
Assuming: 20% Tax 12% NI 40% Tax 2% NI
£250 £170 £145 £1000 £680 £580
*subject to ownership transfer cost
Frequently Asked QuestionsIf you would like to take part in the scheme, it is important that you fully understand the scheme before applying. Please note that once the scheme starts, it is not possible to cancel.
Where can I get my bike and accessories?You can choose either Halfords of Evans Cycles to supply your bike. Please note that you can also use both Evans and Halfords vouchers at a network of independant retailers. For an up to date list, please contact the Cycle to Work team on 0800 652 4745.
What if I can’t get to the retailers store?Halfords - if there is not a Halfords store near you or if you are unable to get to a store, please contact the Halfords Cycle Team on 0870 066 0511 to arrange home delivery. You can view their range on www.halfords.co.ukEvans Cycles- if there is not a Halfords store near you or if you are unable to get to a store, please contact the Evans Cycle Team on 0870 164 4023 to arrange home delivery. You can view their range on www.evanscycles.co.uk
What can I use the bike for?For the 12 months of the scheme, at least half of the journeys made using the bicycle should be between your home and your place of work. The use could cover a leg of your journey, for example, from home to your local train station. Once the scheme has finished and if you keep the bicycle, the bicycle can then be used for any purpose. Please note that there is no requirement on you or your employer to keep any records of journeys made.
Can I cancel part way through the scheme?Once you have signed and returned the agreement, you will not be able to cancel the scheme part way through. The salary sacrifice will continue for the full period of the agreement unless you cease employment with your employer before the agreement finishes.
How do I apply?Once you have read through this information pack, you can apply directly through your benefit platform. We advise that you visit the retailer store and make your choice of bike and accesories, so that you apply for the correct amount. Please bear in mind that you will be unable to ‘top up’ your voucher or receive a refund for any excess on the voucher that is not used.
What happens if I leave the company before the scheme finishes?If you cease to be employed by your employer for any reason you will have to pay to your employer the amount by which your salary would have been reduced for the remainder of the scheme period. This will normally be deducted as a lump sum from your final net pay. Therefore, you will lose the tax and national insurance savings on this lump sum.
Do I need to insure the bike myself?Whilst you do not own the bicycle for the 12 month term of the agreement, you must insure the bicycle as you are responsible for any loss, damage or theft and if applicable, note your employer’sinterest. You will be liable for the full value of the hire payments regardless of your / the circumstances once you have signed the agreement.
What is Salary Sacrifice?
In return for your employer providing you with bicycles, you are agreeing to give up (sacrifice) part of your salary. This is a variation to the terms of your contract of employment, which allows your employer to provide you with the equipment free of income tax and national insurance.
Who owns the equipment and what happens at the end of the agreement?During the period of the agreement, the ownership of the bicycle remains with your employer. You must not sell or otherwise dispose of it. At the end of the agreement, typically 12 months you will be offered the bike at the current market value. Your employer may choose to follow the values as prescribed by HMRC which can be found at www.hmrc.gov.uk/manuals/eimanual/eim21667a.htm
What are the implications of Salary Sacrifice?
Because you are agreeing to a reduction in your salary for the duration of the scheme, your entitlement to certain benefits of employment may be affected. The effect is likely to be small but you should consider the following and seek further advice if you have any questions:
Employer Pension - Certain pension schemes may be affected (this may be important if you are approaching retirement and are in a final salary pension scheme) If you have any concerns, you should ask the pension scheme administrators for further information, which will be specific to your circumstances.
State Pension - If you have paid enough national insurance contributions on your income, your Basic State Pension will not be affected. If your earnings fall between the Lower Earnings Threshold and the Upper Earnings Limit, your entitlement to the State Second Pension may be affected. For advice regarding state pensions, you can visit your local Social Security Office or Pensions Centre.
Statutory Benefits – When you sacrifice part of your salary, the calculations for the higher rate of Statutory Maternity Pay, Adoption, Paternity or Statutory Sick Pay will be affected. This is because these statutory benefits are calculated on your salary after the salary sacrifice. Statutory benefits at the lower rates may remain unaffected. If you have any concerns regarding the effect of a salary sacrifice on your benefit entitlements, you can either visit your local Social Security Office or you can visit the website www.jobcentreplus.gov.uk
Cycle to Work Helpline 0800 652 4745
National Minimum Wage – A salary sacrifice agreement cannot be entered into by any employee if the result is to take the hourly pay below the National Minimum Wage. The National Minimum Wage applies in bands for those aged 16 and over. The wage rates are revised on 1st October each year. The current rates can be seen at http://www.hmrc.gov.uk. Whilst you may not be able to enter into a salary sacrifice agreement, you may still participate in the cycle to work scheme. If you think you may be affected, please speak to your employer.
Any other questions?
The Cycle to Work Scheme is operated on our behalf by fair Care. If you have any questions regarding the scheme, please contact your dedicated Cycle to Work Helpdesk on 0800 652 4745 oremail [email protected].
