Cycle to Work
3 Easy Steps!
- Call in store, choose your bike, clothing and accessories. You can also test ride the bike if you wish.
- We will give you a written quote or invoice with the bike, clothing and accessories you have chosen.
- Bring the quote or invoice to your employer and they will organise the payment and you can then collect your new bike.
Your employer will then subtract the money from your salary over an agreed period of time (usually over period of 6 months or a year).
If you are on the higher tax rate you will only pay approximately half of what is subtracted (i.e. if you have spent €1,000 approximately €480 will be subtracted).
Individuals who are directors, self-employed or sole traders can also avail of the bike to work scheme. This is usually done by making a payment from your business account and your accountant will take of your tax credit.
Who is eligible for the tax exemption?
Employees are eligible for the exemption through the participation of their employer, who must operate the scheme. The cost of the bike can be funded either directly by the employer or through a salary sacrifice arrangement with the employee. If the bicycle is purchased directly by the employer, it can be claimed as a tax exempt benefit in kind. Where it is financed via a salary sacrifice, the employee saves on income tax, levies and PRSI.
How does it work?
- 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!
When does the exemption begin?
The bike to work scheme, which was introduced by the Green Party in the 2008 budget, came into operation on 1 January 2009.
What sort of equipment is covered by the scheme?
Tax relief is available on a wide range of cycling gear and cycling equipment – pretty much everything you would need. This list includes helmets, lights, locks, bells, mirrors, cycle clips, panniers, luggage carriers & straps, pumps, puncture repair kits, cycle tool kits, reflective clothing and reflectors.
Is there a limit to the number of employees in a company who can participate?
Once an employer agrees to participate, there is no limit to the number of employees who can avail of the scheme. However, the scheme can only be used by an employee once every five years.
Why is the scheme being brought in?
The Government is trying to encourage commuters to give up the car for shorter journeys. In Dublin, a city well suited to cycling, only 3-4% of commuters cycle to work. By contrast, in Copenhagen over one third of commuters get to work on the bike. More people cycling to work reduces traffic congestion, improves fitness levels and reduces our carbon dioxide emissions.
Why Choose Clarkes of Cavan?
- Get the Best Value!! When you choose your bike from Clarkes of Cavan get 10% of all clothing and accessories!
- Free Bike Servicing!! We will service your bike for free before 3 months after purchase date. At Clarkes of Cavan we pride ourselves in having the best after sales care in Ireland.
- Bike fitting, it is important that your bike is perfect for you. After your bike is purchased we will set up the bike so that it suits you. Bikes come built and ready for the road.
- Most importantly we have a massive range of quality bikes, stocking over 500 bikes we are sure to have the bike for you.
Feel free to talk to one of our friendly staff regarding the bike to work scheme.
Contact: 049 4332166
View our Range of Bikes Here