If you provide a new bicycle or pedelec (bicycle equipped with an auxiliary electric motor) and associated safety equipment (e.g. helmet, lights, lock, etc.) to an employee or director who agrees to use the bicycle to travel to work, a taxable benefit-in-kind (BIK) will not arise, provided that:
- the employee has not received this non-taxable BIK from you in the past 4 years.
- the value of the purchase does not exceed €1,250 for pedal bicycles and €1,500 for electric bikes (e-bikes). If the purchase exceeds the limit, only the portion up to the limit will be non-taxable.
- you, the employer purchases the bicycle / e-bike – the employee therefore cannot purchase the bike and claim a reimbursement.
- the bike is used primarily for work.
If you want this to appear on the payslip of the employee, you can set this up on SimplePay as a custom company contribution item. Selecting the company contribution option when creating the custom item rather than a benefit will ensure that it is not taxed. More information about custom items is available here:
Payroll Setup > Company Setup > Custom Items
You may opt to recover the cost of the bike from the employee through a salary sacrifice. More information about salary sacrifices and our system item for this is available on the following help pages:
Payroll Concepts > Salary Sacrifice
Payroll Processing > System Items > Bike to Work – Salary Sacrifice