With Spring in full flow (despite the odd shower) now is the perfect time to get outdoors. A great way for employees to do so and for employers to save money is to offer a Cycle to Work Scheme.
Fully administered by NannyPaye through your normal payroll, you can deduct the value of a bike from your employee’s salary (spread over 12 months) and therefore not pay any Employer National Insurance on this amount (saving you 13.8% of the value of the bike). Your employee will also benefit greatly by not paying any Employee National Insurance or Income Tax on the cost of the bike.
It’s easy to offer this fantastic benefit to your employee and we suggest visiting websites such as www.bike2workscheme.co.uk. Once you have registered, your employee simply chooses a bike from one of the participating outlets, you purchase it, and your nanny then pays you back through the deductions from their gross salary over a 12 month period. Once the 12 months are over the employee then pays you a flat fee to own the bike which (as it’s already been fully paid for) is normally a very low amount.
The risk associated with an employer offering a Cycle to Work Scheme is that if your employee leaves before completing the 12 months of payments you may not recover the full cost.
Many shops (including Halfords) have complete Cycle to Work Scheme packs with all the paperwork that you need to arrange everything with your employee, and you can also set everything up online – just google ‘Cycle to Work Scheme’.
If you have any further questions on how the scheme works or the potential tax savings that you can benefit from, please don’t hesitate to contact NannyPaye directly!