Cycle to Work licence

The OFT has issued a new group consumer credit licence to cover employers implementing Cycle to Work schemes.

Cycle to Work schemes allow employers to loan bicycle and bicycle safety equipment to employees free of any income tax liability. Cycle to Work schemes give staff the chance to access bicycle and bicycle safety equipment to travel to and from work while also giving them the advantage of an income tax exemption.

We consider that the agreements between employers and employees participating in the schemes will be consumer hire agreements as regulated by the Consumer Credit Act 1974. We have therefore issued a consumer credit group licence to cover consumer hire agreements entered into by employers participating in the Cycle to Work schemes. Employers will be covered by the group licence so long as they are undertaking activities within its terms. Please note that the group licence covers the loan of bicycle(s) and/ or bicycle equipment up to the value of £1,000 (including VAT and not taking into account an income tax exemption). If you carry out regulated transactions other than that described in the group licence, you will need to apply for a standard consumer credit licence.

Find out more information about the implementation of the Cycle to Work scheme from the Department for Transport's website.

Download Group consumer credit licence (pdf 864 kb)

For information about consumer hire agreements generally, see credit and hire agreements.

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