Cycle to work Scheme (Salary Sacrifice)

The University is partnering with Green Commute Initiative (GCI) to enable employees to purchase a new bike out of their pre-tax income. For most people, this could mean a potential saving of around a third - you can use CGI’s online calculator to get an idea of how much you could benefit. 

How the scheme works 

Getting your new bike is simple and we have produced a step-by-step guide to help you through the process so you know what to expect at every stage. 

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Monthly payroll is paid on the last but one working day of every month, with pay dates published in advance for each year.

If your application is submitted before the main payroll deadline date for the month then you will see your first salary reduction that month. Otherwise, your salary reductions will start the following pay date.

It is important for you to understand that the Government’s Cycle to Work scheme is based on bicycle hire with no automatic right to ownership at the end of the hire period.

You will not own the bike during the hire period. You will be hiring the bike from GCI and they will retain the ownership until they agree otherwise.  They will write to you with ownership options at the end of the hire period, ensuring HMRC rules are adhered to.

GCI does not charge a ‘sting-in-the-tail’ exit fee, unlike other schemes, which charge up to 7% of the total value of the bike.  GCI ensures you get the full benefit of the tax break from HMRC by offering you a free of charge loan after the initial hire period.  After the loan period, under a separate agreement, we can transfer ownership title to you for a £1 processing fee.  The £1 acts as a marker to protect you from any future claim that HMRC may make.

When an employee leaves before the end of the agreement, any outstanding amount on the loan must be repaid within 14 days of leaving the employment.  However, the final salary payment must not take them below the minimum wage.  If the outstanding amount owed is not fully covered by the final salary payment, the employee must pay it through their own means.  This will mean that they lose the tax free benefit on any amount not paid via their salary.

HRMC says that once implemented, a cycle-to-work scheme must be available to all employees with no groups of employees excluded.  However, a salary sacrifice arrangement cannot be used if in so doing the employee’s gross pay drops below the NMW.  To avoid this, the employee could be offered a lower value cycle package and/or a longer than usual hire period.

Where employees are paid at NMW and salary sacrifice is not permitted, employers must make an alternative offer.  This could include loaning a bike without salary sacrifice or making available a pool of bikes for those staff to avoid them being excluded from the offer of a cycle. The University continues to operate the ‘Cycle loan scheme’, offering an interest-free loan of up to £2000, repayable over 12 months.

Where a salary sacrifice arrangement is used, your gross pay is affected, which in turn impacts upon your tax and National Insurance Contributions (NICs).  As entitlement to some benefits is based on the amount of NICs that are paid and others on earnings, entering into a salary sacrifice arrangement may affect your current or future entitlement to a range of benefits.

USS and OSPS will accept pension contributions based on ‘notional salary’ i.e. your salary before any sacrifice is made and therefore the benefits of those in these schemes will not be affected. The NHS Pension Scheme, however, will only accept pension contributions based upon the reduced salary.

You must continue to repay your employer for the cost of the voucher.  GCI will terminate the hire agreement and you won’t owe GCI anything.  It is strongly recommended that you insure the bike.

Yes, you can.  Just tell the insurer that you are taking part in a cycle-to-work scheme.  Due to FCA rules, GCI cannot recommend a specific insurer so simply do your own research online.

Laka Bicycle Insurance offers GCI customer’s £30 cover for your bike.  Get a quote.

All the bikes GCI hires come with a 12-month warranty to cover any faults that may develop.  However, you are responsible for any repairs required that are not covered under warranty.

The Scheme is open to all full and part-time staff whose term of employment is more than the period of the loan (12 months). To take advantage of the tax breaks that result from salary sacrifice please also note:

  • You need to be a UK taxpayer
  • You need to be over 18 years of age to comply with Consumer Credit Act legislation
  • You need to be earning more than the National Minimum Wage after your salary has been reduced.

You should use our below calculator to check you meet this requirement before you apply. 


The first step is to choose from the list of participating cycle shops and online retailers and decide which bike would suit you. 

To make things easier, we’ve compiled a handy list of bike shops in and around Oxford that are taking part. 

  • Beeline Bicycles (Cowley Rd)
  • Behind Bars Cycles (Abingdon)
  • BikeZone (St Michael’s Street)

  • Cycle King (Cowley Road)

  • Decathlon Oxford (Seacourt Retail Park)
  • Electric Bikes Sales, Oxford (The Electric Transport Shop)
  • Hawk Wheels (Abingdon)
  • Mickey Cranks (Witney)
  • Reg Taylor Cycles (Iffley Road)
  • Summertown Cycles (Bikezone Oxford) 
  • Warlands (Botley Rd)
  • Walton Street Cycles

Then you will need to fill in the application form, and you will then receive a voucher to pay for the new bike. The cost will automatically be taken from your salary over 12 or 24 months. 

Here are a few key points to bear in mind about the scheme: 

  • You can choose a traditional pedal cycle, or an e-bike if you are commuting longer distances or you’d like some help getting up hills, and can also buy equipment such as a helmet, lock or lights. 
  • Working with GCI means you aren’t subject to a £1,000 cap on the new bike’s value, as with many other schemes – with this one, you can choose a bike worth up to £4,500 and apply directly via the application form. Before applying for a bike valued at more than £4,500 you must first request an ability-to-pay analysis by emailing with the details.
  • It’s important to understand that you won’t legally own the new bike for some time, although it will be treated as yours from the start. 
  • Technically, the bike will remain GCI’s property, and you will be hiring it from them. You won’t automatically be entitled to take ownership at the end of the hire period – although in practice, this is what we expect to happen. The system works this way because of how the government’s Cycle to Work scheme is set up. The idea is that because you don’t own the bike, you don’t have to pay tax on the money spent on buying it.  
  • At the end of the salary sacrifice period, GCI will write to you with options for taking full ownership of the bike, ensuring that all HMRC rules are followed.  
  • To join the scheme, you need to commit to using the bike for at least half your journeys to and from work. 

GCI is a social enterprise whose mission is to enable more people to choose a healthier and more sustainable way to commute. You can consult the FAQ on the GCI website if you’d like to know more. 

Application form

When completing the application form you must enter your employee number as found on your payslip and a personal email address, not your work email address. Failure to do so will mean your application cannot be processed.

Please allow 5 working days for payroll to process your application.



The University offers many other services to help staff get cycling, including a mobile bike repair service – labour is free, so you only pay for any parts used – and up to six hours of free training to make you safer and more confident on the road.

Alternatively, if you want to own your bike immediately or cannot access the GCI scheme due to the minimum wage restrictions, you may wish to use the University’s Bike Loan Scheme, which does not have any tax savings but does offer discounts of 10% with local bike shops. 


Contact us

Sustainable Travel team

+44 (0) 1865 2 88782