The 60-second guide to... getting a bike for half the price
Published 22/05/2016 | 02:30
Fair-weather cyclists may well be considering buying a new bike - given the recent good weather. Should you be one of them, save up to €520 on the cost of a new bike by buying one under the Government's cycle-to-work scheme.
You get a tax break when you buy a bike under the scheme; with higher-rate taxpayers getting the best deal. You qualify for 52pc tax relief if you're a higher-rate taxpayer earning more than €70,044; 49.5pc if you pay the top tax rate but earn less than €70,044; and 29.5pc tax relief if you pay the standard rate of tax. A bike priced at €1,000 would therefore cost €480 - should you qualify for the 52pc tax break; €505 with the 49.5pc tax relief; and €705 if you pay the standard rate of tax.
Before buying a bike under the scheme, contact your employer first. Your employer does not have to take part in the scheme. However, if it does, it must offer it to all its employees.
Should your employer be participating, check if you can buy a bike from any retailer - or if your choice of bike shops is restricted to a specific store. Your employer has the right to ask you to buy your bike from a particular retailer.
Visit the shop, select the bike and equipment you wish to buy - and then ask the shop to invoice your employer directly for the cost.
Don't spend more than €1,000 on your bike (and any biking accessories) as that is the limit on the amount that can be spent under the scheme. Should the bike cost more than €1,000, you will have to pay benefit-in-kind tax on the balance.
Your employer buys the bike on your behalf - and then the cost of that bike is taken out of your salary over the next 12 months. Your employer must pay for the bike - you won't qualify for the tax break if you pay for the bike yourself and are then reimbursed by your employer. You can only buy a bike under the scheme once every five years.
Sunday Indo Business