By Julian Whittle

Last updated at 12:00, Thursday, 27 September 2012

Staff at Carlisle City Council could soon be pedalling to work, rather than driving, walking or taking the bus.

The council is launching a tax-efficient scheme to help its 598 employees save money when buying a bike.

The council would buy the bicycle, which the staff member pays for by 12 monthly deductions from their salary. At the end of the period, they own the bike.

The worker saves because they buy the bike out of gross income, reducing the amount they pay in income tax and national insurance contributions.

There is a small benefit-in-kind tax payment at the end of the 12-month period.

But buying through the scheme still works out much cheaper. For example, on a bike costing £499, the employee would save £140.92 in tax and national insurance. On a £1,000 bike – the maximum allowed – the saving is £269.20.

The council also saves because it does not pay employers’ national insurance contributions on the amount deducted from salaries. The saving is £53.89 on a £499 bike.

Its employment panel is expected to give the go ahead for the scheme next week.

A report from Emma Titley, organisational development manager, says: “A cycle-to-work scheme could encourage staff to take more exercise. It could also help reduce car use, which would reduce congestion, improve the air quality and reduce carbon-dioxide emissions.”

The scheme will be administered by Halfords under HM Revenue and Customs rules. But staff are not restricted to getting their bikes from Halfords.

Independent retailers can sign up too. Scotby Cycles has already agreed to do so.

Where staff do buy from Halfords, however, the council gets a 12.5 per cent cash back on the purchase price.

Unions have welcomed the initiative. A Unison spokesman said: “We know from experience in other local authorities that cycle-to-work schemes work well. Anything that helps members to keep fit and healthy is welcome.”

The city council already operates eight ‘pool bikes’ for staff to use on council business, particularly for short journeys.

It is also considering paying 20p a mile when employees use their own bikes for work-related journeys.

Last year the authority brought in a scheme allowing staff to ‘buy’ additional holiday entitlement. So far 37 have taken advantage, taking up to 10 days extra in return for a cut in salary.

First published at 11:26, Thursday, 27 September 2012
Published by http://www.newsandstar.co.uk