Cycle2work protected in Budget 2016

21 Mar 2016

Whilst expressing concern about the scale of salary sacrifice schemes and suggesting some such schemes may be limited in the future, the government clearly stated that Cycle to Work schemes will not be affected by this and will continue to be an effective way to make savings on cycling.

Cycle2work is pleased to see the government recognising the part cycling to work plays in encouraging employee health and wellbeing.

From the Budget: “1.147 Salary sacrifice arrangements enable employees to give up salary in return for benefits-inkind that are often subject to more favourable tax treatment than salary. The government wants to encourage employers to offer certain benefits but is concerned about the growth of salary sacrifice schemes: clearance requests for salary sacrifice arrangements from employers to HMRC have increased by over 30% since 2010. The government is therefore considering limiting the range of benefits that attract income tax and NICs advantages when they are provided as part of salary sacrifice schemes. However, the government’s intention is that pension saving, childcare and health-related benefits such as Cycle to Work should continue to benefit from income tax and NICs relief when provided through salary sacrifice arrangements.”