Cycling to work?

If you use your cycle for work, here are a couple of tax tips you might find useful.

1) Employers can provide cycles to their employees without incurring a tax charge. Lets say you are going to buy a new bike for £1,000. To pay for it yourself would use up salary of £1,700 if you are taxed at higher rate income tax. However, if you get your employer to pay for it and take a salary of £700 rather than £1,700 there is no extra cost to your employer, you get the bike you were going to buy anyway and you also end up with £400 (after tax) in your pocket!

2) If you already have a bike, your employer can pay you 20p per mile cycled without you having to pay tax. However, this applies only for business journeys so those weekend rides to the country pub don’t count.