Company bikes will become more attractive in 2020
3 October 2019 - Cycling is healthy and good for the environment, and it also reduces traffic jams. In order to encourage employees to cycle to work, the rules have been simplified with effect from 2020.
If an employer makes a bike available to an employee, the bike remains the property of the employer. In that case, a contribution for private use will be possible. This contribution amounts to 7% of the recommended retail price, i.e. the original new value of the bike. The scheme works in much the same way as the contribution for private use for a company car. In practice, there will then be a very low tax burden on the employee. If desired, a company bike can be made available as well as a company car.
A major shareholder director (MSD) is classified as an employee. In this context, it is possible to make a bike available to an MSD.
If there is a (fixed) untaxed allowance for commuting, then this allowance, in the case of a company bike, may no longer be paid untaxed. Even if the commute is performed by car. This is a choice of the employee, with the option for a company bike or a reimbursement in cash etc. However, it is not possible to choose both options.
Both employer and employee can make use of a cafeteria arrangement. A cafeteria arrangement is an arrangement whereby an employee can choose for a part of the salary how and when he will receive it (optional salary). When a bike is made available, (part of) this optional remuneration can be used. The employer must record this change in the employment contract or as an addendum to it. It is important that this is done with appropriate care.
Want to know more?
Would you like more information about company bikes and all the possibilities for your employees? Please get in touch with your regular contact at Mazars or Hardy Bruins by email or phone on: +31 (0)88 277 11 39. They will be happy to help you.
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