Cycle to Work Scheme : Frequently Asked Questions
- What is a Cycle to Work scheme?
- How does it work?
- Can I choose any bike?
- What information do I need to make the application?
- How many times a week do I have to use my bike for work?
- Will my pension and other State Benefits be affected?
- I’d like to join: what do I have to do?
- From making an application, how long will it take for me to receive my bike?
- What happens if the bike gets stolen before the end of the agreement?
- Do I need to maintain the bike myself?
- What happens if I have an accident, am I insured?
- Do I have to wear a Helmet?
- Are there any local Cycling Groups I can join?
- Are there showers I can use at work?
- Should I get my bike serviced regularly?
- What happens if I go on unpaid leave?
- What happens if I leave my job before I’ve finished paying for my bike?
- Will cycleplus/cycle2work affect my Tax credits?
- What are the benefits of participating in the scheme?
- Who is eligible?
- What value of bike can I choose?
- Can I use the scheme to get a bike for a family member, partner or friend?
- Can I apply for more than one bike?
- What are classed as accessories and equipment?
- I’d like to purchase a bike that costs more than a £2,000, can I top up the value myself?
- Is the bike mine straight away?
- What happens if I do not want to keep the bike at the end of the agreement?
- What is a salary sacrifice arrangement and how are the savings made?
What is a Cycle to Work scheme?
cycleplus and cycle2work is a government approved scheme that allows you to hire a bike and safety equipment from your employer for the purpose of commuting to and from work and for use at weekends and evenings. If you choose cycleplus you can order your bike from any participating local retailer, if you choose cycle2work you can order your bike from any Halfords store. The bike you hire will be provided at up to 42% less than the usual cost you would pay which can result in savings of up to £420*.
How does it work?
You can choose a bike up to the value of £2000 from a list of local bike retailers provided to you or Halfords stores. The value is spread across a period of 12 months. This is commonly known as a salary sacrifice or salary exchange scheme, whereby an employee gives up the right to receive part of their cash pay due under their contract of employment. You agree with your employer that each month the payment will be deducted from your gross salary in return for the use of the bike and safety equipment you use for commuting. This element of salary will not have Tax or National Insurance applied to it, making this a Tax free benefit.
Can I choose any bike?
As long as the store you choose to visit either stocks or can order the bike you want then you are not limited to any particular make or model, therefore you can choose the best bike that suits your needs and budget. You can also buy safety equipment only, and do not have to buy a bike as long as the minimum spend is £100.
What information do I need to make the application?
You do not specify a bike at the application stage, you would just need to have a bike in mind for the purposes of the value of the Letter of Collection you require i.e you need to decide on the value you wish to sacrifice.
How many times a week do I have to use my bike for work?
The bike hired through the scheme is provided on the basis that you intend to make at least 50% of your trips or part trips to work using the bike. However, there is no requirement for you to specify what days/months of the year you will do this or record trips. N.B. you may also use your bike for leisure and weekends and whilst you are on holiday.
Will my pension and other State Benefits be affected?
Pension schemes will continue to calculate your pension contributions on your original gross salary. Effects on the S2P (formerly SERPS) are likely to be negligible (please contact the University Pensions Officer if you require further advice). Other benefits such as statutory sick pay and job seekers allowance are again unlikely to be affected.
I’d like to join: what do I have to do?
Firstly find out your local participating bike shop or Halfords store. You then visit the shop and choose your ideal package. To apply, simply call 0845 050 2174 or follow this link, and choose Halfords or independent stores via the P&MM web-site – the details of which will be communicated to you by Bangor University. Once Bangor has received your application and you have been approved, a letter detailing your requested value (letter of collection) will be sent to your home address, or via email if an email address has been supplied. You then take this along to your local store or Halfords to collect your bike and safety equipment.
From making an application, how long will it take for me to receive my bike?
All applications will be considered once the window has closed, regardless when in that window the actual application was made. From the date on which the window closes we will endeavour that you should receive your letter of collection within 10 working days. Once received you will then be able to collect your cycle. There will be clarification of this information as to this timescale on the front page of the Hire Agreement you will sign at application stage.
What happens if the bike gets stolen before the end of the agreement?
It is important that you make suitable provision to safeguard the bike as you are responsible for the cycle at all times during the hire period. You may take a specialist policy but it is often easier to add the bike to your usual household policy. If the bike is stolen your employer will continue to deduct the monthly value from your salary until the end of the agreement.
Do I need to maintain the bike myself?
You are responsible for maintaining the bike for commuting to and from work as well as your own private use. Your local shop or Halfords will be able to advise you about the necessary servicing depending on how you use your bike.
What happens if I have an accident, am I insured?
No, the scheme does not provide personal injury insurance and nor is your bike insured for accidental damage. If you wish insurance this should be taken out separately.
Do I have to wear a Helmet?
You don’t have to wear a helmet by law but it is recommended, as is the wearing of high visibility clothing. More information on cycling safety is available from cycling.bangor.ac.uk
Are there any local Cycling Groups I can join?
Yes, there are a number of Groups including an informal University Cycling Group. Please visit cycling.bangor.ac.uk for more details
Are there showers I can use at work?
All staff can use the shower facilities at Canolfan Brailsford. Also, there are a number of staff showers located within academic buildings across the estate. For more information on shower facilities visit cycling.bangor.ac.uk
Should I get my bike serviced regularly?
It’s certainly recommended to do so. An annual service, normally during early Spring, will ensure your brakes are not only working but will last the season, and will check all the bike’s components to help ensure you enjoy trouble free cycling. Please visit cycling.bangor.ac.uk for more information on bike maintenance.
What happens if I go on unpaid leave?
During approved unpaid leave such as extended Maternity leave or a career break the hire agreement is likely to be suspended by your employer until you return to work and full pay resumes.
What happens if I leave my job before I’ve finished paying for my bike?
Under the terms of the hire agreement you will agree to settle all outstanding monies before you leave. The outstanding balance will be deducted from your final net salary payment.
Will cycleplus/cycle2work affect my Tax credits?
Most staff will benefit from joining the scheme. Current advice suggests that bike schemes are unlikely to affect Child Tax Credits. If you are in receipt of Working Tax Credits due to a lower household income then this may cancel out any benefit you gain from the scheme. As everybody’s circumstances are different we recommend you contact the Inland Revenue on 0845 300 3900 if you are unsure.
What are the benefits of participating in the scheme?
- You can save up to 42% in Tax and National Insurance (based on a higher rate tax payer).
- You pay monthly and so can spread the cost.
- You can choose from any make or model available from a range of local bike shops or Halfords stores.
- You can improve your health and fitness along with reducing your carbon footprint.
Who is eligible?
cycleplus and cycle2work are governed by the Department for Transport. In order to receive the Tax benefits resulting from a salary sacrifice arrangement you will need to be a UK taxpayer, who can benefit from the Tax efficiencies of the scheme. Bangor University must make the scheme available to all staff, however we do maintain the right to decline an application should we feel appropriate. You will of course be given a reason for this should this happen.
What value of bike can I choose?
You can choose to take between £100 and £2000. When deciding on a bike value it’s important to consider carefully the amount you can afford and the type of bike that best suits your needs. A calculator is available for you to calculate the monthly deductions that would be made. Once you have chosen your value, completed the hire agreement and received your Letter of Collection you will not be able to increase or decrease the amount you have chosen. Once you have chosen your value, completed the hire agreement and received your Letter of Collection you will not be able to increase or decrease the amount you have chosen.
Can I use the scheme to get a bike for a family member, partner or friend?
No – the bike must be used by you and mainly for the purpose of commuting to work. However the bike can be used in leisure time so you may use the bike in your free time to cycle with friends and family.
Can I apply for more than one bike?
Yes you can apply for a maximum of 2, and that the total LOC value of the bikes is below £2000. Both of the bikes must still be utilised for commuting to and from work for at least 50% of the time.
What are classed as accessories and equipment?
These are classed as suitable as long as they aid the rider in terms or either safety or comfort. Such accessories can include helmets, lights, cycle locks and so forth. The scheme allows you to buy such equipment with your bike, or to buy the equipment only, without having to buy a bike. If only buying equipment a minimum of £100 must be spent.
I’d like to purchase a bike that costs more than a £2,000, can I top up the value myself?
No, the scheme does not allow for such a top-up.
Is the bike mine straight away?
The bike and goods remain the property of the University for the duration of the 12 month agreement. At the end of the hire period Bangor’s current preferred option is to extend the loan of the cycle to their employees for a further 5 years (although no payments would be made by the employee after the 12 months). Should the employee leave the employment of Bangor University within this extended 5 year period, please see the matrix below to advise of the transfer of ownership at that stage, and the amount that would be payable by the employee.
|Age of Cycle||Original price of cycle less than £500||Original price £500+|
|6 years and over||Negligible||Negligible|
What happens if I do not want to keep the bike at the end of the agreement?
If you choose to become the owner of the goods, you may be offered the opportunity to do this at fair market value. This amount is not Tax and National Insurance free. If you choose not to buy the bike you will be charged the equivalent of the Fair Market Value to dispose of the goods. The fair market value cannot be specifically stated before or during the scheme as this could be considered a benefit in kind and hire-purchase does not warrant any Tax-relief.
What is a salary sacrifice arrangement and how are the savings made?
Salary Sacrifice or Salary Exchange basically means you have agreed with your employer to exchange a proportion of your salary in return for some form of non cash benefit, in this case the hire of a bike.
*savings based on a higher rate tax payer