New UK Tax Relief Scheme Boosts E-Bike Sales
LONDON, UK – Earlier in the year Rob Howes, a C2W (Cycle to Work) expert who designed and built Halford’s original C2W web application, launched ProC2W. It allows UK employers to purchase (electric) bikes on behalf of employees who benefit from tax relief, saving up to 42% of the recommended retail prices (RRP) of the bicycle.
ProC2W is different to the original C2W scheme which still exists in one crucial respect; the original GBP 1,000 (€ 1,370) per bike cap does not apply.
According to Howes, the removal of the GBP 1,000 per bike purchase price via Pro C2W has led to 70% or so of applications being for electric bikes. It’s the result of a ‘perfect storm’ of employer and retailer awareness of the scheme combined with weary commuters looking for a time and cost-effective alternative to the UK’s commuter gridlock and rising public transport costs.
How does it work?
ProC2W requires a willing employer (private or public), a tax paying (PAYE) employee who wants a bike to commute to work on a bike (electric or non-electric), and a bike retailer willing to apply to ProC2W. Unlike the traditional scheme, using ProC2W retailers can make a single application per bike rather than having to subscribe to join a scheme. The scheme also applies to bike accessories and safety equipment used for commuting.
A worked example provided by Howes to Bike Europe assumes a GBP 3,000 (€ 4,100) purchase. A higher rate tax paying employee will save GBP 1,260 (€ 1,725) on the bike purchase price whilst a lower rate tax payer will save GBP 960 (€ 1,315). The employer makes a 33.8% return on the original GBP 3,000 investment, some GBP 1,014 (€ 1,390) on top of the purchase price repayment, recouped via employee payments and various tax incentives.
Interestingly the ProC2W website targets potential electric bike customers very strongly, although the scheme can equally be applied to non-electric bikes. With around 70% of bikes purchased via the scheme featuring electric assist, Howes summarises just why he thinks e-assist is proving so popular.
“We are finding increasingly numbers turning to electric bikes who are not regular cyclists, but those who usually commute by other means. They are being tempted by the ever expanding range of electric bike technology available in the UK. With electric bike technology now maturing it’s clearly reached a point where it can be relied upon by regular commuters and this fact is starting to permeate the public consciousness. Short term factors such as public transport strike activity has also clearly had an impact.”