Company bike taxation
Everything you need to know
Quick facts about company bike taxation
A company bike is an employee benefit
A company bike is an employee benefit offered by the employer, just like a company car, company phone or sports benefit.
A company bike is a tax-free fringe benefit
The value of the bike is not counted as part of your taxable income. This means that if your monthly salary includes a €100 bike benefit, you will only pay tax on the rest of your salary, not the value of the bike.
Part of the salary or on top of the salary
A company bike can be offered as part of your current salary or on top of your salary. This means that your salary can be reduced by €100 per month (which reduces your tax rate) or it can be offered in addition to your salary (which does not impact your tax rate).
Maximum deduction €1200 per year
The maximum amount that can be deducted from your taxable income for a bike per year is €1200. This means that if the bike costs more than €1200 and the company would buy it outright, then the tax benefit would only be €1200. Because of the leasing arrangement, the tax benefit can be spread over multiple years.
Redeem the bike tax free
At the end of the leasing period you can redeem the bike without it being a taxable benefit. This means you do not need to pay tax on the redemption value of the bike.
Include accessories in the purchase price
You can include certain accessories in the purchase price of the bike, such as a lock, a helmet and lights. You cannot include things like clothes, a child seat/trailer or shoes.
The tax-free company bike reduces your tax rate
When it is said that getting a bike as a company bike saves you x percent on the purchase price, this refers to the tax incentive of the bike benefit. The tax-free company bike reduces your tax rate if its value (€100 per month) is taken off your salary.
You do not have to pay tax on the value of the company bike, which means that you pay less tax on the rest of your salary.
Example
Your monthly salary is 3000 euros, and normally you are taxed on the full 3000 euros.
When you take up the bike benefit, which your employer offers as part of your salary, the value of the company bike, i.e. 100 euros per month, is taken off your salary, which reduces your taxable income to 2900 euros.
This reduces your annual taxable income by 1200 euros. This also reduces your tax rate.
And you still get a brand new bike. So you can subtract the total tax benefit from the purchase price of the bike, which would not have applied if you didn’t get it as a company bike.
This is the benefit that getting a bike as a company bike has in terms of purchase price.
Use our calculator to work out the exact tax benefit for your personal circumstances.
Accessories included in the purchase price
As defined by the tax authorities, the purchase price of the company bike can include everything without which the bike would be unusable. The benefit also includes any fixed accessories.
Accessories that can be included in the purchase price:
Handlebars
Wheels with tyres, incl. studded tyres
Saddle
Pedals
Breaks
Lights
Locks
Mudguards
Rack
Rear rack
Helmet
If one of the above parts/accessories breaks, the price of a new one will be included in the maintenance and repair costs. If, however, you choose to e.g. replace the saddle at a later stage, then the replaced parts become a separate benefit.
Accessories that cannot be included in the purchase price:
Odometer, speedometer and power meter
Water bottle and holder
Cycling shoes and clothes
Panniers
Pump
Trailer
Child seat
Taxable value of a company bike
The taxable value of the company bike consists of the purchase price, the accessories which are approved by the tax authorities and bought at the same time as the bike, as well as maintenance and repair costs during the leasing agreement.
FleetBike’s administrative charge is not included in the taxable value.
Tricky taxation questions
If you have an employer-subsidised commuter ticket, the total combined tax-free value of the ticket and the bike is 3400 euros per year. In other words, the bike benefit reduces the total amount by 1200 euros, so that the maximum value of the commuter ticket is reduced to 2200 euros.
If the employer buys a bike and gifts it to the employee, then it is no longer a bike benefit, but instead a taxable fringe benefit which makes up part of the employee’s salary.
Itching to buy a new bike?
If your company has a contract with FleetBike, you can fill out our purchase form straight away. If your company does not yet have a partner for company bikes, you can tell your employer about FleetBike.
