Please read this document carefully as it contains important information relating to the operation of the Cycle to Work Scheme. If you apply for the Cycle to Work Scheme and are accepted, you will be deemed to have read and understood the scheme rules and agree to be bound by them for the duration of the scheme.
What is the Cycle to Work Scheme?
The Cycle to Work scheme allows you to exchange a portion of your salary for the use of a bike and safety accessories of your choice up to the value of £1,000.00 through cycle shops in the UK registered to participate in the scheme through our chosen provider, Cycle Scheme. As long as the bike is used primarily for travel to and from work, you will not have to pay either tax or national insurance contributions on the portion of your salary which you exchange under this arrangement. This represents a significant saving to you on the equivalent in-store price of the bike and safety equipment.
Do I need to use the bicycle only to travel to and from work?
If you register for this scheme, you are confirming that at least 50% of the bike’s use will be for eligible work journeys. Eligible journeys include cycling from home to work, cycling from home to a train/bus station, cycling from the station to work (and the reverse journeys). You are not expected to keep detailed records of the time spent cycling or miles travelled but you may be required by HM Revenue and Customs (HMRC) to make a declaration confirming that your use of the bike meets these requirements.
Am I eligible for the Cycle to Work scheme?
All Manchester Metropolitan University employees may apply to participate in the scheme.
The scheme as described in paragraphs 1 and 2 above is operated through a salary sacrifice arrangement as this is the most tax efficient way of offering the scheme and represents the best value for employees. However, not all employees may be eligible to participate in a salary sacrifice scheme (for example if the value of the salary reduction would reduce your salary to below statutory minimum wage). Where employees are unable to participate in the salary sacrifice part of the scheme, the University has made alternative arrangements so that you can still participate in the scheme but not via salary sacrifice.
If you have any questions on this, please contact the Reward & Planning team by email.
If I sign up for the scheme, how will my salary be adjusted?
Your salary will be reduced each month by the monthly equivalent of the value you select. Tax and national insurance are not paid by you on the amount of the salary reduction.
Does this arrangement affect my pension or any other benefits?
Entering into a salary sacrifice arrangement means that your gross pay is reduced by the amount which you select for your chosen bike and appropriate safety accessories. It is important that you are aware that this may have an effect on the following:
More information on the implications of entering into a salary sacrifice scheme can be found on the HMRC website.
In addition, if you are a member of the Teachers’ Pension Scheme your pension contributions will be based on the reduced salary after salary sacrifice. This is particularly relevant in respect of death in service benefits and also if you are close to retirement.
It is your responsibility to ensure that you understand the implications of joining the scheme, either on any potential future state benefits or your pension entitlement. You should satisfy yourself that this scheme is appropriate for your particular personal situation.
Are there any other implications for my salary?
Payments such as overtime or shift payments (which are a percentage of your normal salary) will continue to be made on your normal salary before the sacrifice for the bicycle.
What happens to my salary at the end of the hire period?
The scheme and the reduction in your salary will normally operate over 12 pay periods. At the end of the period, the variation to your terms and conditions of employment will cease and your monthly gross pay will increase by the same amount previously reduced through the salary sacrifice scheme.
How do I register for the scheme?
Registration can be completed in just a few simple steps.
What happens next?
Your registration request will be processed in 5 easy stages:
What if I cannot redeem my secure voucher before the expiry date?
Salary reductions will commence one month after you have signed and returned the variation to contract letter and hire agreement, irrespective of whether you have collected the goods. The University will confirm with you when payroll deductions will commence.
What if I change my mind?
Once you have signed the hire agreement, you are confirmed as participating in the scheme. The hire agreement cannot be cancelled and you cannot change your mind on the value of the voucher you have chosen, either before the payment term starts or during the term.
The amount of the salary sacrifice arrangement is fixed for the duration of the hire period (12 months) and you cannot opt out, irrespective of whether you have collected the bike or if you have decided that you no longer require the bike. Please ensure therefore that it is affordable and that you intend to use the bike for the duration of the scheme.
Am I able to have more than one bike under the scheme?
Yes, providing that both bikes are used for eligible journeys under the scheme. For example, if you travel to work partially by train, you could have one bike to commute between home and the station and another to travel from your destination station to your place of work. However, the £1,000 scheme limit applies.
Does the bike come with a warranty and insurance?
Your bike will have a 12 month warranty (possibly more depending on the manufacturer) and in the event of any problems, the bike should be returned to the appropriate store.
It is your personal responsibility to insure the bike against theft, damage or loss including injuries or damage to a third party and you may be required to provide evidence of this to the University. You may be able to add the bike to your own home insurance policy. The University has no liability in this respect.
If the bike is stolen or damaged beyond repair, you have effectively left the scheme and need to pay all outstanding monies due under the balance of the hire agreement from your net salary, i.e. you lose the benefit of the tax and national insurance relief.
Do I need to maintain the bike myself?
You are responsible for looking after the bike and maintaining it in a roadworthy condition for your own use. The supplier will be able to advise you about necessary servicing and will also be able to help with any queries on warranty.
What happens if I leave the University?
If you leave the University for any reason during the term, you will be required to pay an amount equivalent to the remaining balance of the value of the secure voucher. You will lose the benefit of the tax and national insurance relief and the full gross amount remaining will be deducted from your final net salary. If your final salary is insufficient to cover the full amount, you will be required to pay any outstanding balance to MMU by cheque within 14 days of your resignation taking effect.
What happens if I take maternity or sick leave during the lease period?
You will continue to have use of the bike. Salary reductions will continue for the period of paid leave and will be suspended if your pay is reduced to lower than the sacrifice amount. If you are absent on maternity leave or sick leave and in receipt of a statutory benefit (such as SMP or SSP), salary reductions will cease either when you are in receipt of statutory maternity/sick pay only or if your occupational maternity/sick pay is insufficient to meet the salary reduction (whichever is the earlier).
If you are on maternity leave and choose not to return to work or on sick leave and unable to return to work through ill health, you may be liable for a termination fee equivalent to the balance outstanding on the hire agreement. You should note however that the period spent on maternity leave or absent on sick leave counts towards the completion of your obligations under the hire agreement, irrespective of whether you were in receipt of salary during the whole or part of this period. Any outstanding balance is payable from net salary and if your final salary is insufficient to cover the amount outstanding, the balance will be payable by you to the University by cheque within 14 days of your resignation taking effect.
What if I am absent from work for any other reason?
If you are in receipt of your normal salary during your absence (ie not in receipt of any statutory benefits such as SMP or SSP), your salary reductions will continue as per your hire agreement.
What if I am on unpaid leave during the registration period?
You need to be receiving some form of pay when the invitation to register for the scheme is sent out. If you are not receiving any pay, then you will be able to participate in the next scheme as long as your pay has restarted.
Can I use the bicycle for business journeys (for example travel between different University sites)?
Yes but you will not be able to claim cycle mileage allowance in respect of business journeys made on a bicycle which is leased from the University.
Who owns the bicycle?
You will not own the bicycle or safety equipment described in the hire agreement. The bicycle and safety equipment will be owned by the University and leased to you for the duration of the contract lease period.
What happens to the bicycle at the end of the contract term?
The contract lease period is for 12 months. At the end of this period, you will be required to return the bicycle and safety equipment to the University. The University may offer to sell the bicycle to you for a fair market value to be determined at the time. Any arrangements made at the end of the contract term for the sale to you of the bicycle will be subject to a separate agreement outside of the terms of this scheme.
Can I register for the scheme at any time?
Yes – the scheme is open for enrolment at any time.
Can I participate in more than one bike scheme concurrently?
No. If you have already registered for a scheme, it is not possible for you to register to participate in another scheme until your lease period has expired.
Can I use the letter of collection to obtain a bike for a family member or child?
No. The scheme is only open to employees of the University and can only be used for an adult bike and appropriate safety equipment and to meet the main criteria of the scheme which is that 50% of the bike’s use should be for commuting to work purposes.