Introduction
Once you have a quote for your bike and/or cycling equipment, you can use this to check your finances.
It is important to think about whether you can afford the monthly hire payments, and consider any effect that a salary sacrifice scheme may have on your personal finances.
You must also make sure your hire payments do not cause your salary to drop below the minimum wage rates.
Impact on personal finances
Before you enter a salary sacrifice scheme, you need to consider the impact it will have on your personal finances. Here are some things that could be affected:
- Borrowing money - if you are considering applying for a mortgage, your salary will be lower which could limit how much you can borrow.
- Maternity pay - to qualify for statutory maternity pay your average weekly earnings must be above a specific amount detailed on the GOV.UK website via the link below.
- Student loan repayments - as your repayments are based on your gross salary, you won’t pay as much - this means your repayment period may be increased.
You can read more about the effect of salary sacrifice on payments and benefits on the GOV.UK website.
Minimum wage rates
Anyone above school leaving age and working in the UK must receive either the:
- national minimum wage, for aged 20 or under
- national living wage, for those aged 21 or over.
These rates are reviewed by the government and change each year on 1 April.
You can find out more about the minimum wage rates on the GOV.UK website.
Keep your salary above the minimum wage
Before you enter the cycle to work scheme, you’ll need to make sure that your pay does not fall below the national living wage, or national minimum wage if you are aged 20 or under, at any point during your hire agreement period.
Our cycle to work cost calculator will help you with this if you are paid the national living wage. If you are paid the national minimum wage you can:
If the unexpected happens
We know that sometimes unexpected things happen, and that you cannot account for every eventuality while you are on the cycle to work scheme.
If your working arrangements change or there is an unpredicted significant increase in the national minimum wage rate that would prevent deductions from continuing from your salary, it will be identified by the strategic pay services team. Advice will be sought from the team to check it is appropriate for the hire agreement to be extended to enable you to complete it.
Calculate the cost
Use the calculator to:
- find out if you can afford to hire the bike and/or equipment you have chosen
- work out whether a 12-month or 18-month hire agreement would be better for you
- make sure the hire payments will not cause your salary to fall below the predicted minimum wage rates during the hire period.
1Download the calculator
Download the cost calculator below:
2Fill in the form
For question 1, select your current pay grade from the dropdown options.
Your current salary, or the full-time equivalent if you are part-time, will appear below question 1.
If you work part-time, amend the answer to question 2 to the actual hours you work.
For question 3, enter the cost of the bike and/or equipment (you can adjust this later if needed).
On question 4, enter the date you’d like your contract to start.
3Results
The calculator will then calculate your hourly salary rate, and give you the following figures for both a 12-month and 18-month hire agreement:
- the amount per hour to be deducted from your salary. This is known as salary sacrifice and is based on the cost of your equipment and the contract period for the hire agreement
- what your hourly salary after the salary sacrifice amount is deducted
- when your contract will end
- whether your salary will be above the minimum wage rate. This is based on the predicted minimum wage amount at the end of your contract.
In this example, the applicant can apply for a 12-month hire agreement but, as their salary would be below the minimum wage rates in 18 months, they can not apply for an 18-month contract. However, if a national pay increase has been agreed between the unions and the council, this can be taken into consideration.