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Halfords Cycle2Work Scheme

How does it work?

Cycle2Work is a government initiative which offers the most cost-effective way to get new cycling equipment. The scheme is run through participating employers, meaning you do not have to pay tax or national insurance on these products – saving you up to 43.25%! This reduced cost is then simply deducted out of your payslip over 12 or 18 months.

How to Apply for the Halfords Cycle 2 Work Scheme

How to apply

1. Employer code

If your employer has a live scheme, you’ll either be given an employer code to sign up directly through Cycle2Work, or be pointed towards your benefits portal to apply.

2. Choose your value

Choose your bike and/or accessories online before applying so you know the total value to apply for.

3. Sign up

Now that you have your employer code and total value, you’re ready to sign up.

4. Approval

Once your employer has approved your application, you’ll receive a ‘letter of collection’.

How to buy

5. Use your ‘letter of collection’

You can buy your bike and/or accessories in store or online using your letter of collection.

6. Pay monthly

Once your scheme starts, the salary sacrifice will be deducted out of your payslip over 12 or 18 months.

7. End of scheme/Ownership

Once your hire period has come to an end, we’ll get in touch to discuss your options. This will include the opportunity to extend the hire of the cycle at no additional cost until HMRC deem the value to be negligible. This is typically 4 or 5 years, and once this agreement has finished you will become the rightful owner!

What is a letter of collection?

  • A letter of collection is what you will use to purchase your bike and/or accessories
  • Once you have applied and been approved for Cycle2Work, you will receive yours via email
  • To redeem simply email the letter of collection.
  • You can also redeem in store by taking your Letter of Collection with you.
  • To redeem your Letter of Collection at one of the independent bike shops we work with, please contact us on 0345 504 64444 or loc.allocations@halfords.co.uk with the name of the store you would like to use, the value of your letter of collection and your letter of collection number. We will then allocate to the store within 24 hours.

Frequently Asked Questions

How can I save through Cycle2Work?

Cycle2Work is an employee benefit which is operated as a salary sacrifice, meaning you agree to give up some of your gross salary (before tax) in exchange for a benefit e.g. a new bike and accessories. By having a salary sacrifice, you are reducing the amount of income you pay tax and National Insurance on which is where the savings are made.

The amount you can save is dependent on the tax bracket you are in. The latest tax rates can be seen on the Government website. 20% taxpayers can save 33.25% and 40% taxpayers can save 48%. Use our Savings Calculator to work out exactly how much you will pay monthly – and how big your savings are!

Do I have to cycle 2 work every day?

In short, no! The government guidelines state that you should use your bike and accessories for commuting for at least 50% of its usage. However, you do not have to log your bikes mileage and we thoroughly encourage you to use your bike in your spare time!

What happens to the bike at the end of the hire term?

Once your hire period has come to an end, we’ll get in touch to discuss your options. This will include the opportunity to extend the hire of the cycle at no additional cost until HMRC deem the value to be negligible. This is typically 4 or 5 years, and once this agreement has finished you will become the rightful owner!

What if I leave my company within my hire agreement?

We completely understand that life can be unpredictable. If you were to leave your company or be made redundant in your hire period, the remaining gross balance would simply be deducted from your last payslip.

My employer Cycle2Work scheme is run by a third-party benefit provider, how do I apply?

Some employers use a benefits portal to run the Cycle2Work scheme. The step-by-step application process will be listed on the portal. If you are not sure if your employer uses a benefit provider, or you are not sure who the benefit provider is, please contact your HR Department.

When can I apply?

Every employer has a different application window. You may have seen this advertised around your workplace or via email. If you are unsure when your Cycle2Work scheme opens and closes, please contact your HR department.

What is the maximum value I can apply for?

This can be different for every employer. You may have seen this advertised around your workplace or via email. Please contact your HR Department if you do not know what your scheme’s maximum limit is.

How do I know how much to apply for?

We recommend finding your perfect bike and accessories before applying so you know exactly what amount to apply for. This way you won’t apply for too much or too little – this is really important to get right because you cannot amend your application once you have been approved, or add your own money to you LoC

Can I apply more than once?

As long as you don’t exceed your employees limit, you can technically apply more than once – providing the deductions from your payslip don't take you below the National Minimum/Living Wage. However, depending on your employer it is not always possible to make a second application so you must always check with your HR Department first

Can I amend my application once it has been submitted?

Technically once you have submitted your application, you are unable to amend it. What you can do in some cases is cancel your application and reapply for your new amount – however this is not always possible, so we advise that you ask your employer for their cancellation terms and conditions!

Is It possible to cancel my Cycle2Work application?

Yes, you have 14 days to cancel your Cycle2Work application from the date that you sign your hire agreement. To do this, please use the cancellation link that you should have received via email. Alternatively, contact us with your reasons for cancellation

My Letter of Collection has expired. What do I do?

Before you spend your Letter of Collection, contact us and we will extend your Letter of Collection for you.

Do I have to spend my Letter of Collection all at once?

Yes, you must spend the whole Letter of Collection as you can only use it once, and the amount you have applied for will be the set amount that you pay, for even if you spend less.

Can I add my own money to my Letter of Collection?

Not officially. But chat to us and we will make arrangements to help you.

What are ‘hire periods’ and ‘hire agreements’?

Your hire agreement is essentially the 'terms and conditions' of Cycle2work, which you will agree to when applying. Your hire period is the period that this agreement is valid for. It's traditionally also the period in which you will pay your salary sacrifice (this tends to be 12 or 18 months). However, there may be circumstances where your salary sacrifice may be longer and your costs spread over a longer period of time. This will be at your employers discretion and you would be notified if this was the case.

Where can I get my bike and accessories from?

We offer a wide range of accessories on our second website New Bike Parts

I want to spend my LoC at an independent bike shop like us. How do I do this?

First, go to our Store Locator and choose your local bike shop. We will then need to transfer your Letter of Collection before you visit the store. To do this please contact us on 0345 504 6444 or email loc.allocation@halfords.co.uk.

A small number of bike shops are currently charging an administration fee to accept Cycle2work letters of collection. To avoid this please contact us on 0345 504 6444 or email cycle2.work@halfords.co.uk and the team will do their best to look for an alternative bike or shop to redeem in.

Will this affect my other employee benefits?

This is very unlikely, however every company and employee is different so please speak to your employer for more advice.

Can I use Cycle2Work to get a bike for someone else?

No, the items that you select must be for yourself.

What happens if my bike gets damaged or stolen?

Looking after your bike is your responsibility, however, to make this a whole lot easier we offer all of our members 14 days free insurance on bikes purchased from Halfords. This insurance is NOT applied automatically and you must activate it here. Please note, if you bike is damaged or stolen and you do not have insurance, your payments will continue regardless.

Can I sell my cycle to work bike?

You can sell your ex-cycle-to-work bike at the end of your hire period once ownership has been transferred, you will need to have chosen one of the following options from your end of hire survey which you will receive via email towards the end of your hire period:

Extended hire - Ownership transferred after 5 years

Fair market value - To be paid in a Halfords store, once paid ownership transferred

Who is responsible for the maintenance of the bike?

You as the customer are responsible for the maintenance of your bike to ensure it is usable to commute to work.

I already own a bike, can I still apply?

Of course! You may want to get a whole new upgrade, or a second bicycle for a different season or terrain. Just want accessories? Using the Cycle2Work scheme for accessories only is a very popular option for employees who already own a bicycle and just want to upgrade the rest of their equipment!

Can I get more than one bike?

Yes! If you would like to get two bikes you certainly can – as long as they are both suitable and safe for you to ride, and your total doesn’t exceed your scheme’s maximum limit.