freetown sports cycle2work scheme
faq - employee's questions
What do I get out of it?
You can save income tax, VAT and national insurance contributions by having the bike's retail price removed from your salary before deductions, saving up to 50%. You can spread the cost of a new bike over 12 months.
Who does the bike belong to?
You will be leasing the bike from your company for 12 months. At the end of that period, your company can transfer ownership for a nominal fee.
Can I buy any bike?
Your new bike must be used mainly for commuting, and therefore suitable for this purpose. Road bikes, commuting bikes, mountain bikes, hybrid bikes and folding bikes can be purchased using the voucher. Children's bikes are not available via C2W. Any brand of bike, and sale bikes can be purchased.
Can the bike be more expensive than my voucher amount?
Yes, but you need to use your own money to make up the difference when you pick up the bike. The extra amount will not be part of your salary sacrifice.
What if I want a bike cheaper than the voucher amount?
The amount printed on your voucher cannot be changed, so you will still be charged the same amount every month if you take a cheaper bike.
Can the bike be used for leisure riding as well as commuting?
Yes, as long as the primary use is to get to work.
What accessories can I include?
You can include safety accessories that are associated with riding the bike to work e.g. helmet, reflective wear etc. Non-related items like downhill helmets, energy food or car racks are not allowed.
Can I purchase accessories only?
No, the rules set by the DfT say that you must include a bicycle under this scheme.
Can my voucher be used to buy a bike for somebody else?
No. The voucher is not transferable to friends, family, other employees or anybody else.
What would happen if the bike was stolen?
Freetown Sports would recommend a comprehensive insurance policy. We can recommend a company that deal directly with us for replacement cycles.
When do I start paying?
Your monthly salary sacrifice will usually begin when you receive your next pay packet after you have collected your bike or had it delivered. Check with your own payroll department or HR for confirmation.
What does "salary sacrifice" mean?
Salary sacrifice means giving up part of your salary in exchange for a benefit, in this case, a bicycle and accessories. Salary sacrifice cannot be used if your monthly payments take your remaining gross salary to below the minimum wage.
Can I pay off the balance in one payment or over a shorter time?
No. The commitment will run for 12 months.
What happens if I'm off work?
If you take and form of leave or a holiday that takes your monthly salary to below the amount of your salary sacrifice, your employer will suspend the payments until you are earning again.
What happens if I leave my company?
If you leave the company or retire, your bike becomes a taxable benefit. The remaining balance on the price of your bike will be deducted from your final net salary. As these will no longer be part of the salary sacrifice you will not save the income tax or National Insurance on the remaining balance.
Is there a minimum/maximum amount that I can spend?
The minimum voucher amount is £250, and the maximum is £1000. If you decide to spend your own money to "top-up" the voucher when you collect your bike, those amounts will not be covered by the salary sacrifice arrangements, and you will not be able to make tax-savings on the extra amounts. The ownership of the bike remains wholly with your employer.
Do I need a voucher for the retail cost, or the cost after the savings?
Your voucher will need to cover the total retail cost (before savings) of your bike and accessories.