Tuesday, 3 November 2020
Department of Finance
Cycle to Work Scheme
398. To ask the Minister for Finance if he will consider amending the bike to work scheme as part of the Budget 2021 process to allow more cohorts access the scheme, including the self-employed and retired persons; and if he will make a statement on the matter. [32426/20]
409. To ask the Minister for Finance his plans to roll out the bike to work scheme to those in receipt of the old age pension in view of the recent tightening of Covid-19 restrictions; and if he will make a statement on the matter. [32565/20]
I propose to take Questions Nos. 398 and 409 together.
Section 118 (5G) of the Taxes Consolidation Act 1997 provides for the cycle to work scheme. The scheme provides an exemption from benefit-in-kind where an employer purchases a bicycle and associated safety equipment for an employee to use, in whole or in part, to travel to work. Safety equipment includes helmets, lights, bells, mirrors and locks but does not include child seats or trailers. The scheme requires that the employee must mainly use the bicycle and safety equipment for qualifying journeys. This means the whole or part of a journey between home and the normal place of work.
The Financial Provisions (Covid-19) (No. 2) Act 2020 made some changes to the scheme, increasing the exemption limit from €1,000 to €1,250 or, in the case of electric bikes, to €1,500 for employer expenditure on the provision of bicycles and associated safety equipment, and also enabling employees to avail of the scheme more frequently.
Benefit-in-kind is a charge to tax that applies where an employer provides an employee with a benefit such as a bicycle, car or accommodation. As stated above, an exemption from benefit-in-kind applies in relation to the cycle to work scheme, provided the required conditions are met. However, where an employment does not exist, for example, as may be the case with retired people and old age pensioners, such individuals cannot qualify for the scheme. Also, where an employer-employee relationship does not exist, for example, in the case of self-employed individuals, such individuals cannot qualify for the scheme.
Finally, as Minster for Finance I do not offer any grant schemes for personal transportation. The Sustainable Energy Authority of Ireland is responsible for electrical vehicle grants and comes under the aegis of my colleague the Minister for Communications, Climate Action and Environment.