Green Commute Initiative (GCI) FAQs

  • About the Bike
  • Are there suppliers I can’t use?

    GCI does not deal with the Halfords Group (Halfords, Cycle Republic, Tredz, Wheelies) or Cycle Solutions because they run their own schemes and do not accept vouchers from other scheme providers.
    Occasionally, GCI chooses not to work with a bike retailer for ethical and social reasons.
    As a social enterprise, GCI is a strong advocate for local independent bike shops who can offer excellent customer service and after-sales care. Your local bike shop can set-up your new bike to suit your individual requirements, rather than simply delivering the bike to you in a box and leaving you to figure out the set up. If this is done incorrectly, components can become damaged which can become costly to resolve.
    By using a local bike shop, you don’t need to worry about getting hold of bike boxes or paying and waiting for couriers; you can simply drop and collect the bike at your convenience. Your local shop can offer you advice, bike fits, servicing and often, cycling clubs as well.
    Local bike shops will struggle to compete against online only retailers who benefit from bulk order discounts which enables them to offer heavily discounted prices. But this is balanced with a vastly reduced level of customer service which can be difficult to access when you need them.
    The local high street is being eroded by the effects of big, faceless discount retailers. GCI is a supports business that can give back to their local communities and enrich the lives of those living within them.

  • Can I buy a second-hand bike?

    You cannot have a second-hand bike or just the kit to convert a normal bike to an e-bike.

  • Can I have more than one bike?

    Providing your employer agrees, yes you can.

  • Can I include accessories in my bike package?

    Yes, your bike package can include accessories and a common sense approach should be taken when deciding what to include.  You can include items such as helmets, bells, lights, child safety seats, clothing, tools and spares.  However, you cannot include bike computers with or without GPS or waterproof clothing that is not reflective.

  • Can I insure a bike that doesn’t belong to me?

    Yes, you can.  Just tell the insurer that you are taking part in a cycle-to-work scheme.  Due to FCA rules, GCI cannot recommend a specific insurer so simply do your own research online.
    Laka Bicycle Insurance offers GCI customer’s £30 cover for your bike.  Get a quote.

  • Can I sell the bike?

    Not until the end of the extended free loan period, unless we agree otherwise in writing.

  • Can my bike package just include spare parts?

    The Department for Transport guidelines state the cycle to work scheme is for the hire of a cycle for active travel and/or safety equipment.  Under the examples of safety equipment, it includes “replacement parts to keep a cycle roadworthy”.  Therefore, you are able to put through an order for just parts and accessories, as long as the total order value exceeds £100.

  • Do I need to keep mileage records?

    Currently, HMRC don’t require mileage records or any logs.  However, please ensure the majority of use is for commuting.

  • What if GCI goes bust?

    GCI Ltd.’s constitution prevents it from incurring debts which means that it cannot go bust and no-one else can have any claim on its assets.

  • What if the bike breaks down or needs repairs?

    All the bikes GCI hires come with a 12-month warranty to cover any faults that may develop.  However, you are responsible for any repairs required that are not covered under warranty.

  • What if the bike is stolen?

    You must continue to repay your employer for the cost of the voucher.  GCI will terminate the hire agreement and you won’t owe GCI anything.  It is strongly recommended that you insure the bike.

  • What if the shop I want to use isn’t signed up?

    Most resellers (bike shops) are delighted to work with GCI because it’s a much better deal for them (and therefore you).  Ask them to get in touch to become a registered reseller.
    We cannot deal with the Halfords Group (Halfords, Cycle Republic, Tredz or Wheelies) because they will not take other provider’s vouchers as they run their own schemes.  GCI supports local bike shops and therefore does not work with the big online-only suppliers.

  • What is an E-bike conversion kit?

    This enables you to upgrade any standard pedal bike to an electrically assisted pedal bike. The kits can be bought on the Cycle to Work Scheme but only from resellers registered with GCI. The kit must adhere to EAPC regulations and have a maximum power output of 250w. The conversion kit will be hired to employee and will be listed on the Hire Agreement whilst the bike remains their property.

  • Who else can ride the bike?

    You can allow anyone over 14 years old to ride the bicycle, however you are still responsible for it.

  • Who owns the bike?

    GCI owns the bike for the duration of the hire but we’re contractually obliged to hire it to you.  At the end of the scheme you will be offered an extended free loan.  A part of the loan agreement is that GCI appoints you as our agent to dispose of the bike to a third party of your choosing.

  • Why does the bike go from 2 bars worth of battery to flat?

    The display indicator estimates the amount of battery remaining based on usage. The last 2 bars last twice as long as a single bar and will then go from 2 to 0. Recharge when it reaches two bars to avoid running out of power while riding. Mileage varies based on factors like rider weight, road conditions, and assist level.
    6 Bars => Full Battery
    4 Bars => Medium
    2 Bars => Low Battery, Require Charging.

  • About the Scheme
  • Are the bikes safe as an asset of GCI?

    GCI is a social enterprise, whose constitution prevents it from taking on debt therefore it can never have creditors and cannot become insolvent.  This means the bikes are safe and will always end up with the employee.  GCI is the only cycle-to-work provider to offer this.  In today’s retail environment this is a vital safeguard.

  • Do I need to pay the bike shop a deposit?

    The bike shop may wish to charge a deposit in order to secure the deal, however they should refund this back to you in the event your organisation decides to not take part in the scheme.  If you do proceed, the deposit will be refunded back to you when you collect your bike.  However, if the bike shop has had to place a special order for you, they may decide to withhold the deposit in the event the deal does not go through.  You should ensure both you and the shop are clear on this point.

  • Does the scheme just offer E-bikes?

    No, you can get a normal bicycle through the scheme.  You can choose from E-bikes, road or off-road bikes, folders or cargo bikes.  If it’s a bicycle under the Road Traffic Act, it qualifies.

  • During the Covid-19 crisis, I have been working from home. Can I still get a bike through the scheme if I’m not currently commuting to work?

    Yes, you can.  HMRC rules state that the majority of the use of the bike must be for commuting and this can be over the lifetime of the bike.  So whilst you may not use it much for commuting at the moment, you will more than make up for that over the coming years.  You may also want to take time to build your fitness levels in preparation for your new commute to work.  By working at home you are probably saving money by not indulging in daily coffees or buying train tickets.  So it makes sense to get a new bike now so you are prepared for when your place of work does reopen and life returns to some sort of normality.

  • How does GCI work?

    Your employer buys a voucher which entitles you to the hire of a bike of your choice directly from us. Because we’re authorised by the FCA there is no £1,000 limit.
    The cost of the voucher is the same as the bike so for a £1,500 bike the voucher is £1,500.
    You repay the cost of the voucher by sacrificing a part of your gross (before tax & NI) salary. This means you save the tax and NI that you would pay if you bought the bike from your net (after tax) pay. Your employer also saves 15.05% employer’s NI. So it’s worth them doing it.
    At the end of the hire period we can’t give you the bike because you would incur a tax liability. So, we make you a free of charge loan of the bike for a further five years and nine months. After 6 years, under a separate agreement, we can transfer to ownership title to you for a £1 processing fee.  The £1 acts as a marker to protect you from any future claim that HMRC may make.
    We manage all the end of scheme arrangements so there is nothing for your employer to do and best of all no end of scheme sting as there is on old fashioned Cycle to Work schemes.

  • How does the cycle to work scheme work?

    Cycle to work schemes allows employers to offer their employees the use of a bike for commuting in exchange for a salary sacrifice.  The salary sacrifice enables the employees to use their gross pay to reimburse the employer for the cost of the bike.  The gross pay is before tax, so the employee saves the tax and national insurance which would have been due on the amount sacrificed (33.25%, 43.25% or 48.25%).  It also allows employees to spread the cost over monthly pay packets, making the acquisition more affordable.

  • How long is the agreement for?

    There are two separate agreements:
    The salary sacrifice agreement is between the employer and employee and covers the repayment of the voucher cost.  This can be for any period longer than three months that both parties are happy with.  Common terms are 12, 18, 24 months but it could be for as long as 60 months.
    The hire agreement is between the employee and GCI Ltd.  This is unaffected by the length of the salary sacrifice.

  • How much money will I save?

    This all depends on which income tax-band you are in.  This coupled with your national insurance contributions will give you the percentage of what you’ll save from your gross salary.
    Basic Taxpayer Rate = 20%.
    National Insurance contributions = 13.25%.
    Total saving = 33.25%.
    Higher rate tax payers can save as much as 48.25%.
    To find out how much you will save on your bike package, use our savings calculator.

  • How much money will my employer save?

    Employers can typically save 15.05% of the total value of the salary sacrifice, due to the reductions in Employers’ National Insurance contributions.  The savings will reduce slightly if the employer has opted to use third party finance or if 30-day terms has been agreed.

  • How to cycle to work in a suit?

    E-bikes are the future of commuter travel.  The battery assistance kicks in when you need it meaning you don’t need to get hot and sweaty cycling up hills or going long distances.  This means you can cycle to work wearing your usual business attire without the need to change or shower when you arrive at your destination.

  • How to decide which cycle to work scheme to use?

    There are numerous cycle to work providers available in the UK and you need to choose the one which meets your needs.  If your employees need cycles that are over £1,000, such as commuter-quality e-bikes, cargo bikes or specialist bikes for disabled people, then Green Commute Initiative will be the obvious choice.  GCI has no £1,000 limit and no scheme exit fees.  This means employees will benefit from the full tax saving applicable to them.  GCI is also the only scheme set up as a not-for-profit social enterprise whose constitution prevents it from taking on debt.  Therefore, it can never have creditors and cannot become insolvent.  This means the bikes are safe and will always end up with the employee.  No other provider can currently offer this safeguard.

  • I am self-employed, can I take part?

    Sadly, you will not be able to take part because your tax arrangements are different. You may be able to claim business use for the bike though.

  • I’m a Director of my own company, can I take part?

    If you pay PAYE as a Director you will qualify.  You may wish to consult your accountant for advice.

  • I’m VAT registered. Can I reclaim the VAT on the voucher?

    VAT has been payable by employees on salary sacrifice schemes since 2012.  As a VAT registered business, you can either claim the VAT back on day one and then at the end of the salary sacrifice issue an invoice to the employee for the gross amount of salary sacrifice including VAT.  This invoice is shown as paid via salary sacrifice, so the employee doesn’t pay twice (the salary sacrifice amount includes VAT).  Or you can simply not claim back the VAT, making a note in your accounts to this effect.  We recommend the second method but either is fine.  As long as the VAT is paid HMRC are happy.

  • Is my organisation already signed-up?

    Your organisation does not need to be signed up for you to use Instant GCI.  Instant GCI works on an individual basis, so as long as your employer agrees to your request, you can go ahead.  If they have already allowed other individuals to take part in the scheme, it is likely that the scheme will be advertised internally on either staff noticeboards or the intranet.
    For Corporate GCI, your organisation will have an GCI code which allows you to access the dedicated portal.  Your HR department or intranet will provide this.

  • Is there a maximum on how much I can spend?

    Employers can set internal limits for employees which could be calculated as an actual amount or a multiple of a month’s gross salary.  Sound judgement should be made when considering if an employee can actually afford an expensive bike package.

  • Is there anything to pay at the end of the scheme?

    GCI does not charge a ‘sting-in-the-tail’ exit fee, unlike other schemes which charge up to 7% of the full value of the bike.  GCI ensures you get the full benefit of the tax-break from HMRC by offering you a free of charge loan after the initial hire period.  After the loan period, under a separate agreement, we can transfer to ownership title to you for a £1 processing fee.  The £1 acts as a marker to protect you from any future claim that HMRC may make.

  • Is this HMRC compliant?

    Yes.  You can see the confirmation in the third paragraph on the Employment Income Manual page of their website.
    “The exemption also covers the provision of a voucher for hiring bicycles and equipment.”
    One of the big four accountancy firms said:
    “Our review of the GCI documentation has confirmed that the scheme arrangements are
    robust and comply with the relevant legislative exemption in respect of cycles and cyclist’s
    safety equipment.”
    Please ask us if you would like to see a copy of their report.

  • Taking part in the scheme would take me below national minimum wage, what can I do?

    HRMC says that once implemented, a cycle-to-work scheme must be available to all employees with no groups of employees excluded.  However, a salary sacrifice arrangement cannot be used if in so doing the employee’s gross pay drops below the NMW.  To avoid this, the employee could be offered a lower value cycle package and/or a longer than usual hire period.
    Where employees are paid at NMW and salary sacrifice not permitted, employers must make an alternative offer.  This could include loaning a bike without salary sacrifice or making available a pool of bikes for those staff to avoid them being excluded from the offer of a cycle.

  • We already have a cycle-to-work scheme, can we have GCI as well?

    Yes, you can!  Organisations can choose to run different cycle-to-work schemes at the same time.  There are no rules that say otherwise.  Some clients use their current providers for traditional bikes under £1,000 and GCI for bikes over £1,000.
    Please remember GCI does not charge a ‘sting-in-the-tail’ exit fee, unlike other schemes which charge up to 7% of the full value of the bike.  GCI ensures you get the full benefit of the tax-break from HMRC.  After the free of charge extended loan period, there is a nominal £1 fee to transfer title ownership of the bike.

  • What happens when an employee leaves their employment before they have repaid all the money?

    When an employee leaves before the end of the agreement, any outstanding amount on the loan must be repaid within 14 days of leaving the employment.  However, the final salary payment must not take them below the minimum wage (before tax is deducted).  If the outstanding amount owed is not fully covered by the final salary payment, the employee must pay it through their own means.  This will mean that they lose the tax free benefit on any amount not paid via their salary.

  • What is a framework agreement?

    This is an agreement between a contracting authority and one or more of its suppliers.  Its purpose is to establish the terms (e.g. price) governing contracts to be awarded during a given period.  Usually, framework agreements are compliant with all UK/EU procurement legislation.
    Typically, framework agreements are used by public-sector bodies such as health trusts and councils, and often they will be shared with other public-sector bodies to appoint suppliers.  This enables other organisations to avoid the tender process, thus saving time and money.  The maximum duration of a framework agreement is four years.
    Green Commute Initiative continues to work with councils and health trusts and has put together a framework agreement with Somerset County Council.  This has subsequently been used by other public bodies.

  • What is a pro-forma invoice?

    The proforma is simply a quote and not binding on anyone unless it’s paid.

  • When is cycle to work day?

    Cycle to work day takes place in August and although originally it was a marketing campaign developed by another cycle to work provider, it has become an industry-recognised event.  Here at GCI, we believe every working day should be a cycle to work day!  If your organisation would like to hold a GCI Awareness Day at your offices, the give us a call to put a date in the diary.

  • Who provides the third-party finance?

    We have relationships with several finance companies, Akira being one of them.  There is an 8% charge when using third party finance but this is more than covered by the employer’s 15.05% NI saving.

  • Why no £1,000 limit?

    Green Commute Initiative is authorised by the Financial Conduct Authority for consumer hire up to any value.  Since you’re hiring the bike from GCI, your employer doesn’t need FCA approval.   View our FCA registration

  • Will I lose my tax-free benefit if I leave my employment before the end of the agreement?

    When an employee leaves before the end of the agreement, any outstanding amount on the loan must be repaid within 14 days of leaving the employment.  However, the final salary payment must not take them below the minimum wage.  If the outstanding amount owed is not fully covered by the final salary payment, the employee must pay it through their own means.  This will mean that they lose the tax free benefit on any amount not paid via their salary.

  • Will it create lots of administration for my organisation?

    No!  GCI handles all the admin using standard templates for the Salary Sacrifice Agreement and the Hire Agreement which are sent out electronically.  Once those have been signed, GCI ensures all parties receive their copies and send out the voucher.
    For Corporate GCI customers, a scheme manager does need to be appointed to oversee the portal.  The scheme manager sets parameters, approves or reject applications, and checks their progress, informing staff of the status of the deal.  But it’s not overly onerous and shouldn’t take too much time away from other tasks.

  • Will my state benefits be affected by salary sacrifice?

    Where a salary sacrifice arrangement is used, your gross pay is affected, which in turn impacts upon your tax and National Insurance Contributions (NICs).  As entitlement to some benefits is based on the amount of NICs that are paid and others on earnings, entering into a salary sacrifice arrangement may affect your current or future entitlement to a range of benefits.

  • Will salary sacrifice affect my workplace pension?

    Yes, reducing your gross salary will most likely reduce your pension contributions, which in turn affects your final pension pot.  However, your employer might have different pension arrangements in place.  Please consult your pension provider for more details.

  • With third party finance, is the employer or employee responsible for the loan repayments?

    Finance taken out with a third party is between the employer and the finance company and as such, the employer will repay the loan.  The employer recoups the money from reduced salary payments, minus the commission on the loan.  The cost of the loan is more than covered by the employer’s reduced National Insurance payments.  The employer still saves money.
    Akira can time their payments so they are due after the salary payment date.

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