The Bicycle Plan: tax benefits for employees and employers

Rain or shine. Full headwind or wind at your back. Electric or purely powered by yourself. In the Netherlands, you can't go anywhere without a bicycle. Instead of purchasing a bike for your commute, you can take advantage of the bicycle plan to lease a bike affordably. What is the advantage of the bicycle plan? There are many, but the most important is that the costs of your bike are much lower than if you buy the bike. Through Alleo, your employees can also arrange their lease bike.  

What is the bicycle plan?

The government introduced the bicycle plan in January 2020, aiming to make cycling to work more attractive. The scheme ensures that the costs for a lease bike fall outside the work-related costs scheme (also known as WKR). As a result, there are several tax benefits, allowing employees to lease a bike for significantly less than the purchase price (up to 80% lower). The electric bike option is also available alongside a lease car. They do not exclude each other.

Bicycle plan benefits

The bicycle plan has several nice benefits for both employees and employers:

• The bicycle plan can be introduced cost-neutrally for the employer. For employers, this means reduced social charges, as no contributions need to be paid on the gross salary for the lease bike.

• The bicycle plan is low in costs for the employee. Because the employee benefits from a gross-net advantage when leasing the bike.

• The bicycle plan has not been part of the WKR since January 1, 2020, meaning you will less quickly reach the limit of your free space.

• The bicycle plan is good for the health and happiness of the employee. The result? Higher productivity and better quality of work delivered.

• The bicycle plan is a sustainable choice compared to a (lease) car or public transport.

How does the bicycle plan work?

As mentioned above, the bicycle scheme was introduced in January 2020. Through the bicycle plan, the costs for the lease bike can be deducted from the gross salary. This means less tax is paid on the gross salary and the lease bike. This way, you finance the bike with a tax advantage.

An example of the bicycle plan

An employee decides that he or she wants to travel to work with an electric bike and introduces the idea of the electric bicycle plan to his employer. Together, they choose an e-bike from a leasing provider. The monthly lease costs consist of the amount for the bike, and service and maintenance costs. Thanks to the bicycle scheme, a portion of these costs is paid from the gross salary, usually about 15% to 20%. Due to this reduction in gross salary, the employer ultimately pays less tax and social contributions on the salary. A benefit, therefore.

Reduction of social charges

Thanks to these tax benefits, the employer can decide to use the amount of the tax advantage again for financing the bike, allowing him to still pay exactly the same gross salary for the employee – even with a bike. The employee finances the rest of the amount themselves, but the costs are lower than with a private lease.

The employer thus pays part of the lease bike without extra costs. This gives the employee a 'free' discount on the lease amount. This makes it a no-brainer of an employment condition 'benefit'.

Bicycle plan and WKR

As mentioned earlier, the lease bike has been outside the work-related costs scheme since January 2020. It does not matter whether the employer contributes to the lease costs or not.

Why is the bicycle plan outside the WKR?

Because there is no direct transfer of ownership between the employer and employee, the bicycle plan falls outside the WKR. Through the bicycle scheme, the employer does not directly provide the bike but finances it as if it were being lent out.

How does the bicycle plan work with the WKR?

If you manage a lease bike through the WKR, you quickly run out of your free space. As a result, you cannot pay for a lease bike for all your employees or use your WKR for other benefits. With the new bicycle scheme, the government has chosen to place the lease bike outside the WKR, but the amount is deducted from the gross salary. Additionally, there is no longer a limit on the purchase price of the bike. Companies can now set their own 'rules'. The bicycles employees can choose from may depend on contract duration or salary.

Conditions of the bicycle plan

The conditions of the bicycle plan are determined by the employer. There is no longer any legal regulation for who pays which costs; the employee determines that themselves. There is also no maximum price that the bike can have. Since the costs are now outside the WKR, there is also no limit on how many bikes can be leased per company. The new regulations therefore bring many advantages.

Bicycle plan for your employees? Book a demo!

For the employer, the bicycle scheme is an incredibly attractive secondary employment condition to offer. The bicycle plan 2023 is cost-neutral for the employer, and the bike is leased at a discount for the employee.

Thanks to our collaboration with Lease a Bike, you can offer your employees a lease bike via Alleo. Together with Lease a Bike, we ensure healthier and more productive employees, something that benefits both the employee and employer.

​Do you want to implement the bicycle plan at your company? Book a demo with one of our employment condition experts.

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