Are Cycle to Work Schemes Worth It?
Cost-conscious employees are actively looking for cheaper alternatives to their daily commute. And with an average saving of £750 each year, it's no surprise that more and more employees are choosing to cycle to work.
For many, though, there's the barrier of the upfront cost of a new bike. Luckily, the Cycle to Work scheme removes that hurdle.
Offering a Cycle to Work scheme is one of the most impactful, cost-effective, low-effort ways employers can step in and make a difference, boosting wellbeing, morale, and even making National Insurance savings along the way.
This guide will explain exactly what the Cycle to Work Scheme is, how it works, and how your business (and your employees) benefit.
How popular is cycling to work in the UK?
More and more people are swapping cars and crowded trains for bikes, and it’s easy to see why. With the cost of commuting continuing to rise, cycling is a smart, affordable, and genuinely enjoyable way to get to work.
According to government data, the average person in England takes 15 cycling trips each year, covering around 47 miles in total. And in cities like Edinburgh, up to 1 in 10 commuters now cycle to work, the highest percentage in the UK.
Health-wise, the stats are pretty compelling too. A 2024 study found that people who cycle to work cut their risk of early death by almost half, and are 51% less likely to die from cancer. That’s a huge win for both wellbeing and productivity.
And here’s the clincher: over 11% of UK adults say they’d be more likely to cycle if their employer offered a Cycle to Work scheme.
So, if your business is looking for an easy win that supports your team, the planet, and your bottom line, you need Cyclescheme.
What are the benefits of cycling to work?
Cycling to work isn’t just good for the planet, it’s good for people. It’s one of the easiest ways for employees to save money, get active, and feel better, without needing to carve out extra time for the gym or deal with crowded public transport.
There are many positives to Cyclescheme, but here’s a quick taster:
- Big savings: That £750 annual saving on commuting costs we mentioned earlier rises to as much as £1,400 for those in Greater London.
- Physical health: Cycling improves cardiovascular fitness and reduces the risk of serious illness. It’s a low-impact form of exercise that’s easy to build into a daily routine.
- Mental wellbeing: Cycling is great for mental health. The combination of fresh air, movement and independence is a natural mood booster.
- Environmental benefits: Swapping car journeys for bikes helps reduce congestion, lower emissions, and shrink your business’s overall carbon footprint.
And here’s the win for employers: these personal benefits translate into business value. Think happier, healthier employees who are more productive, more engaged, and less likely to take time off sick. It’s a simple change that can make a big difference.
Ready to find out more? Book a demo.
What is the Cycle to Work Scheme?
The Cycle to Work scheme is a government-backed salary sacrifice benefit that helps employees save money on a new bike and cycling gear. Instead of buying a bike outright, employees spread the cost interest-free by sacrificing a portion of their gross salary, before tax and National Insurance, saving them up to 42%.
It’s a well-loved employee benefit and a smart way for businesses to support their team’s health, happiness, and finances while also cutting down on Employer NICs, typically saving around 13.8% per employee who signs up.
It’s open to any business (big or small) and available to all PAYE employees.
Best of all, it’s super easy to set up. As Cyclescheme, the UK’s leading Cycle to Work provider, is one of the built-in benefits of BHN Extras, everything from onboarding to end-of-hire admin is handled for you.
It’s one of those rare benefits that ticks every box: cost-effective, good for well-being, simple to manage, and genuinely loved by employees.
Whether you're a small business or a large organisation, joining BHN Extras and offering Cyclescheme is a smart, sustainable way to support your people and your bottom line.
How does a Cycle to Work Scheme work?
Cyclescheme is free to join for both employees and businesses of any size, from start-ups to organisations with a workforce of thousands. The only requirement is that employees must be paid via PAYE.
The employer chooses a Cyclescheme limit (e.g. the maximum an employee can request) and your employees repay the cost from their salary, interest-free over 12 months. To keep things simple for you, Cyclescheme handles the entire end-of-hire process.
Here’s a quick breakdown of how it works:
- You set the budget: Decide the maximum value employees can request
- They choose their gear: Bikes, accessories, safety kit… all from top retailers
- You approve it: We’ll send you a quick invoice to sign off
- They redeem their certificate: Online or in-store, at over 2,600 retailers
- Salary sacrifice begins: Employees pay monthly, interest-free, via payroll
- We handle the rest, Including end-of-hire and optional ownership transfer
There are no upfront costs or hidden fees, and no complex admin for your business to worry about. We provide all the onboarding, marketing materials and employee support to get you up and running fast.
It’s fully HMRC and Department for Transport compliant, and works brilliantly for businesses of all sizes, whether you’ve got 5 employees or 5,000.
Want to see it in action? Book a demo.
What are the benefits of Cyclescheme?
Cyclescheme isn’t just great for employees, it offers big wins for businesses too. From cost savings to sustainability goals, it’s a benefit that delivers on all fronts.
Let’s start with the numbers. For every employee who joins the scheme, your business could save up to 13.8% in Employer National Insurance Contributions. And that’s on top of what they’ll save themselves, up to 47% off the price of a bike and accessories, with the option to spread the cost monthly, interest-free.
And that’s not all. For a typical three-mile daily commute, employees could also save around £100 a year on fuel alone. Plus, with 14 days of bike insurance included at no extra cost, and access to over 2,600 retailers, it’s a hassle-free way to encourage greener commuting.
From a business point of view, the benefits go even further:
- Reduced absenteeism: Active commuters take fewer sick days, which could save UK businesses around £83 million a year
- Increased employee engagement: 44% of employers say the scheme has increased staff engagement
- Stronger ESG performance: Swapping car journeys for cycle commutes helps cut emissions and supports your sustainability goals
- Minimal admin: Cyclescheme handles the end-of-hire process and provides full onboarding support
It’s also a great way to show that you care about your team’s wellbeing. The scheme supports physical and mental health, while making commuting more affordable - something that’s especially valuable during a cost-of-living crisis.
“Cyclescheme supports Oxfordshire County Council in aligning to our goals of being Carbon Neutral by 2030 and enabling our communities (which includes our staff) to become more active.”
Ellie Harriss, HR Support Officer, Oxfordshire County Council.
What’s included with Cyclescheme?
The Cycle to Work scheme isn’t just about bikes, it covers everything your employees need to commute safely, comfortably, and confidently.
With Cyclescheme, they can choose from a huge range of commuting essentials, including:
- Bikes, tyres, components (e.g. brake levers, groupsets), lights, frames, child seats, and cycle trailers
- Safety equipment such as cycle helmets, cycle clips, bulb horns, dress guards, and bike reflectors
- Cycle clothing, including reflective clothing
- Secure bike storage tools e.g. bike locks
- Bike maintenance items such as cycle tool kits and bike lube.
Employees can even request more than one bike (for example, a commuter bike and a folding bike), as long as both are for their own use and sourced from the same retailer.
Got team members curious about going electric? They’re in luck as e-bikes, e-cargo bikes, and conversion kits are all eligible too. You can read more in our Cycle to Work e-bike guide.
How do you join Cyclescheme?
Getting started with Cyclescheme is straightforward and completely free.
Here’s how to do it:
- Register your business: Head to Cyclescheme and complete a quick registration form.
- Choose your scheme limits: You decide how much your employees can spend and what’s included.
- Launch the scheme to your staff: We’ll provide you with all the communications and promotional materials you need to spread the word.
- Approve applications: When employees apply, you’ll simply approve their request, and we’ll handle the rest.
- Start saving: Employees get access to great bikes and gear, and you benefit from NIC savings.
With full support at every step, from setup to end-of-hire, Cyclescheme takes care of the admin so you can focus on the bigger picture.
Ready to join? Request a demo or get in touch today via our contact page.
Cyclescheme FAQs - What Employers Need to Know
What is a salary sacrifice arrangement?
It’s when an employee agrees to give up part of their gross salary in exchange for a non-cash benefit, in this case, a bike and cycling accessories. This reduces their tax and National Insurance contributions, making it a cost-effective way to buy a bike.
What is a hire agreement and hire period?
The hire agreement is the contract between the employer and employee that outlines the terms of the scheme. The hire period is typically 12 months, during which the employee repays the cost of the equipment through salary sacrifice.
Can we run the scheme if employees are close to minimum wage?
Employers must ensure that salary sacrifice doesn’t take employees below the National Minimum Wage. If it would, they may still be able to access a Cycle to Work scheme using a different payment method.
Are independent bike shops included in the scheme?
Yes. Employees can choose to shop at large retailers or support local, independent bike shops that are part of the Cyclescheme network.
Haw do scheme providers like Cyclescheme support employers?
Cyclescheme provides full admin support, onboarding materials, end-of-hire processing, and ongoing compliance guidance, making the scheme hassle-free for employers.
What’s the benefit for our carbon footprint?
Encouraging staff to cycle to work can significantly reduce your organisation’s carbon footprint by cutting down on car journeys and transport emissions.
What if an employee wants to choose an electric bike?
Electric bikes or e-bikes are also included in the scheme. Cyclescheme covers every cycling solution so employees can find the perfect bike to suit their needs and lifestyle.
Does the scheme include tax savings?
Yes. Because the cost is taken from gross salary, employees save on tax and National Insurance. Employers also save on Employer NICs, up to 13.8% per participant.
How is the salary sacrifice period structured?
Typically, employees repay the cost of the bike over 12 months as part of their salary sacrifice scheme. Cyclescheme provides clear documentation to keep everything on track.
How can we promote ourselves as a Cycle Friendly Employer?
Offering the Cycle to Work scheme is a brilliant start. You can also provide bike storage, shower facilities, and encourage participation in events like Cycle to Work Day.
Can any business offer the scheme?
Yes, as long as employees are paid via PAYE, any business can offer the scheme, whether you’re a small startup or a large national organisation.
How do we get started?
That’s easy. Request a demo or speak to our team on 0208 159 9430.
