The morning commute doesn’t have to be a source of stress. Adobe has several programmes to help you find inexpensive, stress-free, and environmentally friendly ways to get to work. We have different benefits to get you where you’re going, depending on how you like to travel.
Cycle to Work
The Cycle to Work plan has been developed in response to the Department for Transport’s initiative to promote healthier journeys to work and reduce environmental pollution. The plan allows employees, Adobe-paid temporary employees, and interns with a contract of more than 12 months to purchase a bike and eligible equipment—including locks, lights, and helmets—valued from £100 to £5,000 through a 12-month hire agreement, whereby the bike is on loan to you from Cyclescheme.
The purchase is made through a process called salary sacrifice, which allows you to receive vouchers for the purchase, free of both Income Tax and employee National Insurance. In order to qualify for the tax exemption, the bike must be lent to you for the 12-month period of the hire agreement, and you must use the bike mainly for travel between home and your workplace or between one workplace and another. Adobe retains legal ownership of the bike.
To request a voucher, visit a participating bike store, and choose the bike and equipment you want, making note of the cost (including VAT). You can then request a quote from the shop to be used for your voucher. Please note that in some circumstances, stores may charge an administration fee. If so, include this amount in your total voucher value.
Visit My Adobe Benefits to request your voucher:
- Go to Benefits Selection > Cycle to work > Select.
- Select the value of the bike and equipment you require. This amount will be your voucher value. Note, the voucher value cannot be altered if you subsequently choose a bike and equipment which costs less than the value of your voucher.
- Click Add to cart > Checkout > Confirm selection.
A confirmation message should pop up if you’ve successfully submitted your selections.
- Your selection will be processed at payroll cut-off in the month after you made the selection.
- Typically, if you select the benefit in one month, it will show in your payslip the following month, i.e., select in March, see in your payslip in April.
- Cyclescheme will then send you an online hire agreement, which you will need to sign electronically.
- It may take Adobe up to four weeks after the invoice is issued by the vendor to pay the invoice.
- Once invoice is paid, your voucher will be sent to you, so you can collect your bike. Please review this guide for more information on the Sign and Collect redemption process including a step-by-step view.
- Due to the above process, it may take up to 8–10 weeks from the moment you selected the benefit until the voucher is released.
At the end of the hire period, you must make another payment to take ownership of the Cyclescheme package. Without this payment, HMRC would class the agreement as hire purchase (rather than hire), and, as such, the tax exemption would not be available.
Cyclescheme can handle all aspects of end-of-hire administration, free of charge, and deals directly with employees to ensure they achieve the highest level of savings, while also ensuring the scheme is compliant with HMRC guidance.
At the end of the 12-month hire period, Cyclescheme offers three simple options: extend, pay, or return. View the Cyclescheme guide for details on the end-of-hire process.
The employee makes a one-off deposit (of either 3% or 7% of the packages’ original value) and continues to hire the bike (under an extended use agreement with Cyclescheme), free of charge, for an additional 36 months until its market value is at its lowest (either 3% or 7%), at which point, Cyclescheme can transfer ownership to the employee at no further cost.
Pay or return
Employees can also choose to take ownership of the Cyclescheme package by making a payment of either 18% or 25%, depending on the provider, of the original value of the bike package.
Cycle to work FAQs
How much does it cost?
Consider a basic rate and higher rate taxpayer selecting a £5,000 voucher:
|Basic Rate Taxpayer
|Higher Rate Taxpayer
|Additional Rate Taxpayer
|Value of cycle voucher
|Employee tax saving
|Employee NIC saving
|Total employee tax savings
|Actual net cost to employee
|Net monthly cost to employee
Therefore, although you have salary sacrificed £5,000, you will see that your take-home pay only reduces by up to £3,400. Furthermore, this will be deducted over 12 months.
How do I purchase the voucher, and what is the tax position?
The benefit is purchased by the company when you agree to the salary sacrifice agreement. In return for buying the benefit and providing you with the use of it, you will have agreed to a reduction in your basic salary for a 12-month period.
As you only pay Income Tax and National Insurance on your new, lower base salary and because this benefit is exempt from both Income Tax and National Insurance, you make savings on any selections (see How much does it cost? for additional information).
Is the hire period the same length as the salary sacrifice period?
As noted above, the hire period for your scheme is 12 months. This means that Adobe owns the bike for 12 months and that Adobe will lend it to you for this period. Your reduction in base salary will also apply over a 12-month period.
What if my circumstances change?
Once you have selected the cycle-to-work benefit, you are committing to the scheme for 12 months. There are no lifestyle events that will allow you to opt out of or change your sacrifice under the scheme.
What happens if the bike is stolen?
If the bike is stolen, you will still need to pay back the voucher amount. We recommend you take out personal insurance for the bike, because it is not covered under Adobe’s insurance.
What happens if I leave Adobe?
If you leave Adobe during the salary sacrifice period, then you will have to pay the remaining balance of the bike to Adobe from your net pay. This payment must be in line with the minimum transfer of ownership value as set out by the HMRC for the 12-month hire period, meaning that the payment you need to make is greater than the outstanding salary sacrifice you were due to make.
Can you stop or amend the benefit before the end of the hire period?
No, the term is fixed. Under salary sacrifice rulings, you must remain in the scheme for 12 months.
What happens if the equipment costs more or less than the voucher value?
You need to ensure that the value of your voucher covers the cost of your bike. You will not be able to supplement any shortfall with your own money.
However, any separate items, such as safety equipment which are paid for in full, can be carried out in a separate transaction, because they will then be owned by you and not subject to the hire agreement. Where this is not possible, this equipment will form part of the hire agreement and will be subject to the terms of the scheme.
Your salary deductions will relate to the full value of the voucher you have chosen.
Annual season ticket loan
Adobe offers an annual season ticket loan—an interest-free loan that allows you to purchase your season train or Tube pass for a full year. Your payslip will include an advance for the ticket amount that you’ll repay in 12 equal payroll deductions.
Typically, if you select the benefit by the payroll deadline in one month, it will show in your payslip the following month, i.e., select in March, see in your payslip in April.
All UK employees, Adobe-paid temporary employees, and interns with a contract of more than 12 months and who are using public transport to and from work may apply for an annual season ticket loan.
You can apply via My Adobe Benefits (powered by Darwin).
- Go to Benefits Selection > Annual Season Ticket Loan > select.
- Enter the amount of the loan required. Make sure you know the exact cost of the ticket you need and the name of the travel company, because you will enter this information in the system.
- Click Add to cart > Checkout > Confirm selection.
- A confirmation message should pop up if you’ve successfully submitted your selections.
- Once you obtain the loan and purchase the ticket, please go back into My Adobe Benefits, and attach the receipt. Proof of ticket purchase needs to be uploaded by the end of the following month.
What happens if I leave Adobe?
If you leave Adobe, you must pay the full remaining balance of your season ticket. If you no longer need your season ticket, you can request a refund from the travel company where you purchased the ticket. They will usually require you to complete a refund form before reimbursing you the outstanding amount, less an administration fee. Please note that each travel company will have their own rules with regard to reimbursement, and you should speak to them directly on their process and terms.