Tuesday, 15 June 2021
Department of Finance
As the Deputy will be aware, section 118(5G) of the Taxes Consolidation Act 1997 (TCA 1997) provides for the Cycle to Work scheme. This scheme provides an exemption from benefit-in-kind (BIK) where an employer purchases a bicycle and associated safety equipment for an employee and was introduced in 2009.
The cycle to work scheme operates on a self-administration basis. Relief is automatically available provided the employer is satisfied that the conditions of their particular scheme meet the requirements of the legislation. There is no notification procedure for employers involved. This approach was taken with the deliberate intention of keeping the scheme simple and reducing administration on the part of employers.
Accordingly, there are no records available on the number of people availing of the scheme.
Tax expenditure reports prepared by my Department have estimated the cost in the full years referenced at €4 million but have been clear that this figure was an estimate as separate returns are not required.
An estimated additional tax expenditure of €0.5m in 2020 and €1.5m in 2021 is expected to arise on foot of the changes made to the scheme by Section 9 of the Financial Provision (Covid-19)(No.2) Act 2020. This increased the allowable expenditure from €1,000 to €1,500 in respect of e-bikes and €1,250 in respect of bicycles and allowed the purchase of a new bicycle every 4 years instead of 5.