Cycle to Work scheme UK

By PaySlipCheck Editorial · Reviewed by PaySlipCheck Editorial Standards Team · 14 June 2026 · 5 min read

The UK Cycle to Work scheme is one of the few remaining fully tax-advantaged salary sacrifice benefits. You sacrifice gross salary in exchange for a bike + safety accessories provided by employer. You save both Income Tax + National Insurance on the sacrificed amount — that's 28% for basic-rate workers, 42% for higher-rate, 47% for additional-rate. Ownership transfers to you at end of scheme (typically after 12 months) via a small final payment. Bikes worth up to £3,000+ available depending on scheme.

Verified against 4 official sources · Last reviewed 14 June 2026
On this page
  1. How it works
  2. Tax savings by band
  3. Ownership at scheme end
  4. Bike price limits
  5. Common providers
  6. In short

How it works

  1. You choose a bike + accessories (bike, lock, helmet, lights, panniers etc.)
  2. Employer buys them
  3. You use them (must be primarily for commuting — HMRC guidance is 50%+)
  4. Gross salary reduced by monthly amount over ~12 months
  5. At scheme end, you either pay a small "market value" fee to own or return

Tax savings by band

At £1,200 bike over 12 months (£100/month sacrifice):

Band Monthly saving Annual saving
Basic (28%) £28 £336
Higher (42%) £42 £504
Additional (47%) £47 £564

Net cost of £1,200 bike: ~£864 (basic) or ~£696 (higher) after tax + NI savings.

Ownership at scheme end

HMRC published market values for bikes at scheme end:

Age £500 bike £1,000 bike £2,000 bike
12 months 18% 25% 25%
18 months 16% 21% 21%
24 months 13% 17% 17%

You pay this % to own the bike outright, or continue rental (rare).

Bike price limits

  • £1,000 default limit for FCA-authorised scheme providers
  • Higher-value bikes (£3,000+) available via FCA-approved providers only

Common providers

  • Cyclescheme
  • Green Commute Initiative (GCI)
  • Cycle Solutions
  • Halfords Cycle2Work

In short

Cycle to Work saves 28-47% of bike cost via salary sacrifice. Up to £3,000+ available. Ownership at scheme end costs ~15-25% of original value. One of the best-value UK employee benefits available.

Frequently asked questions

Can I get any bike?

Bike must be primarily for commuting. Road bikes, hybrids, electric bikes all qualify. Recreational-only mountain bikes may not.

What's included?

Bike + safety equipment (lock, helmet, lights, panniers, mudguards, waterproofs). Accessories must be reasonable + safety-related.

What if I leave my job before scheme ends?

You pay off the remaining balance from net pay. Not a great outcome — planning matters.

Is an electric bike included?

Yes — e-bikes are fully eligible. Higher price limits may apply through FCA-authorised schemes.

What's the maximum value?

Standard scheme is £1,000 limit. FCA-authorised providers can offer £3,000+ bikes.

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Related guides

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More on related topics

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Related salary breakdowns

Glossary terms used on this page

Quick definitions for the key terms above.

  • Salary sacrifice — An arrangement where you give up part of your gross salary in exchange for a non-cash benefit (most commonly pension contributions), reducing your Income Tax and National Insurance.

Sources

All figures on this page are sourced from official UK government publications. We don't cite secondary commentary or other calculator sites.

  1. GOV.UK — Employer-provided benefits (Expenses and benefits)
  2. GOV.UK — P11D form
  3. GOV.UK — Income Tax rates
  4. MoneyHelper — Employee benefits

All tax figures on this page use the same configuration that powers our calculators — see our editorial standards for the review process.

Last reviewed: 14 June 2026. Next review due 14 December 2026.

Disclaimer: This page provides general information based on published HMRC and gov.scot figures. It is not personal tax or financial advice. For your specific situation, please consult a qualified accountant or contact HMRC directly.