Cyclescheme is the UK's number one provider of tax-free bikes for the Government's Cycle to Work initiative. It's a brilliant programme where everyone wins - employees make big savings on new bikes, employers get a healthier workforce and save money too! Cyclescheme has a great track record in helping employers of all sizes to set up and run successful Cycle to Work schemes. Our innovative online system is simple to use, and we have decades of industry experience

Cyclescheme is an independent company created to help employers and employees make the most of the Government's Green Transport Plan Initiative. We use our industry experience to get you the bike you want from a local bike shop. We are independent and can supply the right package of bike, accessories and safety equipment for everyone.

Employees paying PAYE, who have a contract that outlasts the duration of the salary sacrifice period are eligible, provided they are over 18 years old, earn more than the National Minimum Wage after the loan repayment has been deducted, and have completed the employer's probationary period (if applicable).

With a salary sacrifice you pay back the loan on your bike, accessories and safety equipment from gross rather than net pay for the hire period (usually 12 months), allowing you to benefit from income tax and NI relief. See www.hmrc.gov.uk/specialist/salary_sacrifice.pdf for a more detailed explanation.

Typical savings are between 30% and 50%., but the actual amount you pay depends on your personal tax band, and the way your company runs the scheme. Higher rate taxpayers will save more, employees whose company cannot reclaim VAT (the NHS, for example) will save less. If the employer uses external finance (ie your employer borrows the money to buy the bikes from an outside agent) then savings are normally about 5% lower. Finally, the fair market value payment needs to be taken into account when calculating the total savings.

You can choose any bike, including electric and folding bikes, providing your chosen Cyclescheme partner can supply it. Some bike shops may add an administration fee to quotes for custom bikes, because the profit margins are lower than those available on standard, mass-produced models. If your employer wants to supply bikes costing over £1000 (retail price including VAT) then they will need a Consumer Credit Licence, and this costs £725, so many employers limit the package value to £1000.

The bike and goods remain the property of your employer until the hire period finishes, unless your employer uses finance; in this case the finance company will own the bikes during the hire period. At the end of the hire period you may be given the opportunity to buy the bike for a fair market value payment. If the bike gets stolen you will be liable for any outstanding monies without any tax exemptions, so it's very important to make sure the bike is insured. You can obtain safety equipment, including Home Office-approved 'Sold Secure' D-locks and cable locks, as part of the scheme.

Most employers opt to sell you the bike and accessories, and you will pay the fair market value; this is the amount that a buyer would pay to a seller to purchase the bike and equipment. Each bike is assessed separately, but in our experience the market shows values to be around 5% of the original voucher value plus VAT. The fair market value cannot be stated before or during the scheme as this could be considered a benefit in kind as hire-purchase does not warrant any tax-relief.

The scheme uses a voucher system. Once your employer has entered into a contract with Cyclescheme, you need to sign an employee hire agreement that we supply or agree to the terms of the hire agreement online (this process is determined by your employer). You visit your local bike shop for a quote on a bike and accessories, which you enter onto our extranet system. When we receive the quote we will invoice your company, and provide a secure voucher once the hire agreement is signed. You take the voucher back to the bike shop to collect the bike.

You can use the bike however you like; a bike purchased under Cyclescheme should be used for work journeys at least 50% of the time. You don't have to cycle to work for a specified number of days throughout the year and you don't have to record your trips or mileage. You may not claim expenses for business trips made using the bike until the end of the salary sacrifice period.

Your Household policies are usually the cheapest option but you must ensure that the insurer covers the bike when in storage away from your home, and that the bike's value doesn't exceed the upper claim limit. If the bike can't be covered on your home insurance, we recommend Cycleguard (02476 851 000) for insurance, and the free services provided by Fetch (0870 460 8167) who will expedite your claim and ensure that you are able to replace your bike using the bike shop of your choice.

Cyclescheme's partner shops are capable of supplying bike packages mail order from their shops, but there are distinct advantages when getting a bike from your local bike shop that will be the first port of call for advice, servicing, after sales and warranty. Some mail-order specialists are not part of the Cyclescheme Partner network.

Yes. Your partner shop will be able to advise you about necessary servicing depending on how you use your bike. Many shops offer a free first service.

The agreement to pay your loan is non-cancellable, so you will be obliged to pay the remaining amount in full, without any tax exemptions. If you opt to take ownership of the bike you may have to pay an increased fair market value.

There is no credit check

If you obtain a bike package through Cyclescheme you must insure it during the hire period. Your insurance policy needs to cover the bike for trips to, from and whilst at work and also for leisure riding. As a consequence, when you sign your hire agreement you are agreeing to insure the bike for the duration of the hire period.

Although it might seem strange for the onus to be on you to insure a bike that is owned by your employer this arrangement is in place to protect you: In the event of theft or damage during the hire period you will need to settle all outstanding payments from your net salary i.e. without any tax benefits.

The everyday consequences of not having insurance cover are magnified by the savings made through the scheme and the penalties imposed on early leavers: The government's guidelines on this topic are as follows:

Employees leaving the scheme will pay outstanding amounts from net pay i.e. they will not benefit from any tax breaks

In reality the risks of losing a bike to theft are in proportion to the securing method and type of lock. You must used an insurance company (Sold Secure) approved lock to be covered.

There are many things you can do whilst using or storing the bicycle to make theft less likely. The following advice has been provided by Cycleguard Insurance to assist in reducing the likelihood of theft by taking a few simple precautions:

Never leave the bicycle unlocked Always use a Sold Secure* approved lock appropriate for the value of bicycle Always lock the bicycle to a solid immovable object (If available use a bicycle rack or an object set into concrete or stone where it is not possible to lift the bicycle over or under the object) When away from your usual storage location never leave the bicycle unattended for longer than 12 hours When at your usual storage location always leave the bicycle inside your home, garage or shed when not in use Ensure your home garage or shed is secured with a minimum 5 lever lock or padlock (or lock the bicycle to an immovable object within the garage or shed) Always read your insurance policy to ensure the place you intend to store the bicycle is acceptable to your insurers and that you understand the security requirements. If the bike has quick-release wheels and saddle you can buy an additional cable or replace these items with secure devices that can only be operated with specialist keys.

The information provided here is for guidance only and no contract or contract term is implied by the security advice given - Only the security conditions detailed in your insurance policy wording can be taken as a binding contract.

* Sold Secure is a not for profit trade association with the backing of the Home Office. See www.soldsecure.com for details.

To get your claim settled in good time Cyclescheme highly recommend the free use of Fetch (0870 066 0621) who will handle your claim and get it sorted out really quickly. What's more, Fetch will allow you to collect your replacement bike from the store you bought it from or a store of your choice if you bought it elsewhere or have moved. This is vitally important as receiving a bike in a box robs you of good service and can invalidate the manufacturer's warranty. Fetch also offer a free legal advice line in the unlikely event that you are involved in an accident