Postcode Anywhere biking - Guy Mucklow, Phil Rothwell, Ed Moseley

Back in the Saddle with the Cycle-to-Work Scheme

I’ve been a keen cyclist for 20 years and watched with interest at the general increase of cycling in the UK  recently.

The rise of the MAMILs (Middle-Aged Men In Lycra) could even mean that biking, not golf, is the most popular pastime of the past-their-prime.

At Postcode Anywhere, of course, we have done our part to encourage this by offering a cycle-to-work scheme and free breakfast. In total, 11 – or one in three – staff have joined the scheme, commuting anything from five to 15 miles per day each way.

Feeling, um, ‘wheely’ good

The reported effects range from increased attentiveness and focus, to generally feeling a lot healthier, as well as helping us to be green and save fuel. The downside? Well, there has been a queue for the shower in the morning and some complaints of saddle-related chafing. In all, we think it more than balances out!

For those not familiar, “Cycle to Work” (CTW) is a government-backed scheme where employers purchase a bike and allow employees to use the bike for a set period of time in return for a salary sacrifice. After the end of the formal sacrifice period, the employee is often given the option to buy the bike at a fraction of the original price. The benefit for the employee comes from spreading the “cost” over 12+ months, while saving PAYE and National Insurance on the salary sacrificed.

For our scheme we have avoided well-established “voucher scheme” CTW providers and administered the scheme ourselves. This has allowed us to get a better deal and support a local bike shop by avoiding the commission charged by these companies.

Spoke too soon?

Unfortunately, HMRC recently made things more complicated (and therefore less attractive) by insisting that this ultimate sale to the employee is at market value. VAT is now also payable on the value of salary sacrificed, an extra cost to the employer which will no doubt be passed onto the employee, further weakening the appeal of the scheme.

The effect has been gradual erosion of the benefit for the employee.

However, there’s still reason enough not to feel too deflated: it remains an attractive scheme for both employer and employee and I would encourage any company to set one up. The department for transport has issued a helpful guide, the paperwork is not that onerous, and anything that gets people out of their cars and onto their bikes is good in my book!