We are delighted to be able to offer you a bicycle through the Government’s Cycle to Work Scheme, saving you up to 42% of the retail value (depending on your tax bracket)
To All Burrows Employees
If you wish to join the scheme, your bike can be supplied by any of the following local cycle shops.
Langsett Cycles (long standing and established family business based in Sheffield near our sites).
JE James Cycles who have stores in Rotherham, Sheffield and Chesterfield (larger business).
Giant Store Sheffield, (Giant bike specialists and dedicated womens section).
Expert Bike Repairs (small independent business based in Rotherham).
There is also a JE James BikeWorx cycle to work scheme leaflet available in addition to this information pack and their staff are happy to help answer all your queries in relation to cycle to work.
You will pay for the bicycle in easy instalments, through payroll via a salary sacrifice, over a 12 month period. The Government concession allows for the instalments to be made from gross pay, not net pay, which means tax and national insurance are saved on the value of the bike and accessories.
|Cost to you||Cost to you|
|Basic Rate Taxpayer|
|Higher Rate Taxpayer|
|Retail Value of bicycle and accessories|
|20% Tax 12% NI||40% Tax 2% NI|
This Scheme is available to all our employees to participate in providing they meet the Company and HMRC qualification criteria. Applications should be made to HR department.
The scheme is not a contractual right and may be withdrawn or modified at any time.
Who can join the scheme?
Any employee who has been employed within Burrows for more than 12 months.
What happens next?
If you wish to join the scheme, you need to:
Accessories can only be purchased in conjunction with a bicycle and must be approved under the cycle to work scheme.
What can I use the bicycle for?
Whilst you are in the scheme, at least half of the journeys made using the bicycle should be between your home and your place of work. (The use could cover a leg of your journey - for example - from home to your local train station).
Once the scheme has finished and if you keep the bicycle, the bicycle can then be used for any purpose. Please note that there is no requirement on you or your employer to keep any records of journeys made.
What is a Salary Sacrifice?
In return for your employer providing you with a bicycle, you are agreeing to give up (sacrifice) part of your salary.
This is a variation to the terms of your contract of employment, which allows your employer to provide you with the equipment free of income tax and national insurance.
What are the implications of the Salary Sacrifice?
Because you are agreeing to a reduction in your salary for the duration of the scheme, your entitlement to certain
benefits of employment may be affected. The effect is likely to be small but you should consider the following and seek further advice if you have any questions:
Burrows Benefits - For the purpose of employment benefits and pensions, your normal gross salary will apply. If you have any concerns, you should ask the pension scheme administrators for further information, which will be specific to your circumstances.
Statutory Benefits - Some benefits, such as State Pension, Incapacity Allowance and Jobseekers Allowance are based-on the level of your National Insurance Contributions. If your earnings fall below the Lower Earnings Limit (LEL) as a result of entering into the scheme, your eligibility to receive such benefits may be reduced or you may become ineligible. Your local Social Security Office can advise and give further information. If you have paid enough national insurance contributions on your income, your Basic State Pension will not be affected. If your earnings fall between the Lower Earnings Threshold and the Upper Earnings Limit, your entitlement to the State Second Pension may be affected. For advice regarding state pensions, you can visit your local Social Security Office or Pensions Centre or alternatively visit www.thepensionservice.gov.uk.
Certain Statutory Payments, including the higher rate of Statutory Maternity Pay (SMP) and Statutory Adoption Pay (SAP) are based-on your average earnings, which may be reduced by joining the Cycle to Work Scheme. If you have any concerns regarding the effect of a salary sacrifice on your benefit entitlements, you can either visit your local Social Security Office or you can visit the website www.jobcentreplus.gov.uk.
National Minimum Wage
A salary sacrifice agreement cannot be entered into by any employee if the result is to take the hourly pay below the National Minimum Wage. The National Minimum Wage applies in bands for those aged 16 and over. The wage rates are revised on 1st October every year and published at http://www.hmrc.gov.uk/paye/payroll/day-to-day/nmw.htm. Whilst you may not be able to enter into a salary sacrifice agreement, you may still participate in the cycle to work scheme.
Can I cancel part way through the scheme?
Once you have signed and returned the agreement, you will not be able to cancel the scheme part way through. The salary sacrifice will continue for the full period of the agreement unless you cease employment with your employer before the agreement finishes.
What happens if I leave the organisation before the scheme finishes?
If you cease to be employed by your employer for any reason you will have to pay to your employer the amount by which your salary would have been reduced for the remainder of the scheme period. This will normally be deducted as a lump sum from your final net pay. Therefore, you will lose the tax and national insurance savings on this lump sum. Your employer may offer to sell the bike to you when you leave and if so the value will reflect its ex- rental value. Your employer may offer to sell the bike to you when you leave and to understand the implications of this please read the section “Who owns the equipment and what happens at the end of the agreement?”
Who owns the equipment and what happens at the end of the agreement?
During the period of the agreement, the ownership of the bicycle remains with your employer. You must not sell or otherwise dispose of it and at the end of the term you may carry-on using the bicycle and accessories as before at no charge in accordance with the terms of an Extended Use Agreement which will need to be signed by you at that time. You must at all times abide by the Cycle to Work rules as outlined in this document. At some point in time you may wish to buy the bicycle, in which case you may approach your employer who may make arrangements for the bicycle to be sold to you. HMRC has published a table of values for the sale of ex hire bicycles and your employer has indicated that if approached they would consider sale once the bike has a negligible value according to the table, which is in the order of 5 years.
disposal value percentage
disposal value percentage
|Age of Cycle||Original price of the cycle|
less than £500
|Original price of the cycle|
|6 years and over||Negligible||Negligible|
Can I join the scheme for a second time?
You can only be a member of one Cycle to Work scheme at a time. If you are a member of a previous Cycle to Work scheme and wish to obtain a bicycle this year, you must first apply to Burrows HR department.
Do I need to insure the Bicycle?
It is advisable to insure the bicycle under your normal policy and if applicable, note your employer’s interest.
Any other questions?
If you have any questions regarding the scheme, please contact the Burrows HR department:
Burrows HR Department: 01302 762311
Adele Pinder : firstname.lastname@example.org
1. Choose a cycle and/or accessories based on how much you want to spend on the scheme. You pay a minimum refundable deposit and will be given a receipt.
2. You should send/ scan a copy of the receipt to Burrows HR. The order is then verified and approved by HR. You will keep the original receipt.
3. HR raise an Order Pack for checking and signing. This includes a Purchase Order, along with a Pre-contract Information Sheet and a Scheme Hire Agreement. Documents will be sent out electronically via your Department Manager for signing.
4. You sign the Purchase Order and Hire Agreement on Burrows premises during business hours. This is agreed by the Company and you will receive a copy of the authorised Purchase Order.
5. HR will request an invoice and then pay the cycle company. You will be contacted by HR to confirm when this is completed. You can then take the authorised purchase order to the cycle company and collect the chosen cycle and accessories. The employee must take photographic ID. The original receipt is also needed to reclaim the initial deposit
6. Burrows HR Payroll will then reduce your gross monthly salary by the agreed amount on the Hire Agreement.