It's been seven years since the Bike to Work scheme launched, promising to revolutionise Ireland's commuter traffic by incentivising cycling to work – offering tax breaks for employees and employers who purchased bikes, obviously with the intention of cycling to work on them.
For some savvy employees, they might be on bike number two – you can apply once in every five-year – but for others, they may never have applied. Well, here's why you should (and what you need to know.)
Anyone can apply for a bike
Well, almost anyone. You have to be a full- or part-time employee and you have to be paying tax in the Republic of Ireland. Simple.
And you can buy it anywhere...
Within the limits set by your employer. Essentially, the employer buys the bike – and so they get to decide where you buy it. Some employers who choose to partake in the Bike to Work scheme will give you a specific shop or chain of bike shops from which you can chose your bike, and they'll have arrangements in place for delivery and invoicing. Talk to your boss or HR department and they'll advise you.
You can get up to €1,000 worth of gear...
That's on a bike and accessories, and you'll then pay it back – tax-free – out of your pay each month, usually over a 12-month period (agreed with the employer).
... but you will end up paying for it
Make no mistake – this is not a way of getting a free bike. You'll end up paying back the cost of those wheels; it'll just come out of your payslip before the tax is deducted.
So, say you're in the higher rate of tax, so you pay 40% tax on a portion of your earnings – you'll end up paying €600 for your €1,000 worth of bike 'n' bits. So it's a deadly deal, but it's not a freebie. We repeat: NOT a freebie.
Yep, every employer can be in the scheme
But they have to agree to it.
It's incentivised for them, too; they'll make a 10.75% saving on their PRSI payments, which means they'd be a bit mad not to do it, but they're not obliged to play ball. So if your boss says they're not into it, er, they're not into it.
If you quit, you've still got to pay the difference
Here's the rub; if you leave work before you've paid back the full price (less tax) of your bike bits, you'll have to pay back the difference in your last paycheque. Which could be quite the hit, depending on how soon after joining the scheme you jump ship.
Work this into your finances before you hand in that resignation letter.
And if it gets robbed, well, too bad
You'll still have to pay it back – and insurance is up to you, too, so get that baby insured and think about where you work, and where you'll park it, before you pimp that ride.
If you're working in the inner city with shoddy bike-locking facilities and you work late hours, you're better off going for a cheaper bike.
Strictly speaking, you don't even have to use it for work
That's the purpose of the scheme – "the bike must be used by the employee for qualifying journeys... the whole or part of a journey between the employee's home and place of work" – but no one's checking up on you; there's no requirement to cycle into work for any number of days, and you don't need to clock mileage.
So – not that we're advocating bending the rules – you could, strictly speaking, buy yourself a cheap secondhand bike for commuting, and use your Bike to Work allowance for a state-of-the-art racer. Just sayin'.
Nope, you can't get a secondhand bike
It's for new bikes and equipment – locks, lights, mud guards, high-vis, a helmet, bell and so on – only.
Any other perks?
Well, what about improved fitness; a faster commute, depending on where you live – obviously if you're doing the Swords to Greystones run, a cycle might be a bit extreme, but city centre hops are definitely quicker at rush hour by bike; and a feeling of incredible smug.
Because not only do you know that there's a few euro that are not going to Revenue, but also because you get to be one of those cyclists. You know – the ones who wear cycling shorts to pedal three miles and wear a Go-Pro strapped to their helmet.
More details: biketowork.ie