Learn how to set a cycle to work scheme limit that’s fair, compliant, and e-bike-friendly, plus tips to boost uptake.

You’ve heard there was a Cycle to Work Scheme limit. Then you heard there wasn’t. So, which is it? Here’s the simple answer: there’s no fixed legal cap baked into today’s guidance. 

You, the employer, set an internal cycle to work scheme limit that fits your people, your policy, and your goals. The rest is about keeping it clear, compliant, and fair. Especially if you want more of your team riding e-bikes.

What you’ll get in this guide:

• What ‘limit’ really means today (law vs. your internal cap)

• How to pick the right number for your workforce

• Guardrails you can’t ignore (minimum wage, salary sacrifice, end-of-hire)

• Why e-bikes often need a higher cap and pay you back

• How to roll it out fast with Cyclescheme

Quick refresher: how the scheme works

Employees choose a bike and/or accessories and 'hire' them via salary sacrifice. Deductions come from gross pay, so they save on Income Tax and National Insurance. You recover costs through those deductions and usually save on Employer NIC too. At the end of hire, they pick an ownership route. Simple.

Why this matters for limits: your cap controls affordability, uptake, and fairness. If you cap too low, you’ll lock people out of e-bikes (and longer commutes). If you set it well, with flexible terms, you’ll unlock real behaviour change.

If you want a concise explainer for your HR or finance team, point them to:

• Cyclescheme “Any Price” overview 

• Cyclescheme rules & how it works

The big question: is there a legal cycle to work scheme limit?

The short answer is that there's no fixed legal cap in the current guidance. What exists is your internal limit. Historically, talk of ‘£1,000’ related to credit permissions; that’s not a hard ceiling today. Employers routinely set higher caps, especially to support e-bikes and cargo bikes.

So what keeps you compliant? 

• Salary sacrifice must not drop pay below the National Minimum/Living Wage.

• Equipment should be used for commuting to, from, or between workplaces.

• Keep end-of-hire ownership above board and easy to understand.

Government collections and statistics on active travel are updated regularly and provide helpful context for your policy. Plus, if you want an employer-friendly explainer from a tax body, the Association of Taxation Technicians has a clear overview.

How to choose your internal cycle to work scheme limit

Start with your people and your places. What distance are most staff travelling? How hilly is it? Where are the sticking points? e.g. parking, punctuality, public transport reliability?

Common caps (and what they unlock)

• £1,000: Familiar. Works for many non-electric bikes + basic kit. Restrictive for e-bikes.

• £2,000-£3,000: Covers quality bikes and a strong slice of e-bikes. A sweet spot for many employers.

• £4,000+: Supports premium e-bikes and cargo bikes for longer or load-carrying commutes. Great if you’re targeting car replacement.

Want to go smarter? Tier it. Offer a standard cap and an enhanced e-bike cap (or a role-based cap for field teams who travel intra-day). Keep the wording tidy: one number, or two tiers, explained in a single page.

Cycle to Work Scheme limit: what your cap should cover

If you want to create a long-term change to your employees' commutes, don’t just cover the bike. Cover the kit that keeps people riding all year: lights, lock, mudguards, weatherproof layers, panniers, helmet. That list removes excuses such as dark mornings, wet evenings, and nowhere to stash a laptop, so the commute sticks.

And yes, include e-bikes. The most recent research highlights that e-bikes flatten hills, extend range, and pull in new riders who wouldn’t otherwise switch. Sustrans’ 2025 report sums it up neatly: e-bikes reduce barriers like hilly terrain and fitness levels, and appeal to a wider range of users. Read it here.

Compliance guardrails you can’t ignore

Minimum wage

After sacrifice, the employee’s pay must not dip below the National Minimum/Living Wage. If it would, adjust the request (lower amount or longer term). This is the most common compliance tripwire, so build an automatic check into your approval flow.

Eligible use

The kit should be used for travel to, from, or between workplaces. You don’t need to police every mile; reasonable intent is fine.

End-of-hire ownership

Keep it transparent. With Cyclescheme’s 'own-it-later' path, employees extend the hire for a small, one-off fee and take automatic ownership later. It's simple, compliant, and predictable for payroll.

Leavers

If someone leaves mid-term, you recover the outstanding balance from their final net pay and then offer ownership options. State this clearly in your policy so there are no surprises.

Repayment terms matter as much as the limit

A cap of £2,500 across 12 months can still feel steep to lower earners. However, if you stretch the term (24-48 months, where appropriate), the monthly cost falls into the 'that’s doable' zone.

Same cap. Bigger impact. More riders. More smiles.

Funding models that remove cashflow worries

Most employers use straightforward upfront payment and fully recover the costs by salary sacrifice. If you want to smooth cashflow further, you can use finance options where the modest interest is covered by the employee. Larger organisations sometimes use release-before-payment under agreed terms.

You can choose the model that fits, then let Cyclescheme do the heavy lifting. It’s free to set up, cost-positive via NIC savings, and built to run with minimal admin. Explore employer benefits here.

Setting different cycle to work scheme limits fairly

You can be targeted without being confusing:

• By role/need: Field staff or long-distance commuters get the enhanced e-bike cap.

• By inclusion: Offer a 'starter kit' option for new riders who need essentials more than a new frame.

• By goal: If your objective is car-to-e-bike shift, set the e-bike cap where the useful models actually sit.

Just make sure you explain the logic to your employees, clearly and kindly.

Why a higher limit for e-bikes pays you back

Look at the trends. DfT and National Travel Survey updates show cycling miles per person recovering and rising again in 2024-2025. In 2024, the average cycling miles per person in England was 53, up 12% on the previous year, pointing to renewed momentum you can harness. 

E-bikes are the lever. They turn ‘too hilly’ or ‘too far’ into ‘no problem’. Sustrans’ 2024–2025 research also highlights affordability as a barrier for millions and shows how incentives unlock participation, useful proof when you’re setting a cap:

• “Cycling Opportunity” report (2024)

• Voucher scheme case (2024)

Add the health ROI and it’s a slam dunk. A 2024 BMJ Public Health paper found active commuters were less likely to suffer a range of physical and mental health issues than non-active commuters, which is useful for HR cases focused on wellbeing outcomes. 

Accessories-only and repeat usage

Not everyone needs a new bike every time. Some need winter tyres, serious lights, or a gold-standard lock. Let employees take an accessories-only package within your limit.

And once a hire period ends? You can allow repeat usage, which is great for upgrades, new roles, or changing commutes.

Admin made easy: keep your policy to one page

Here’s the blueprint:

1. The number(s): Your cap - one figure or two tiers (standard + e-bike)

2. What’s covered: Bikes/e-bikes and commuting kit

3. Terms you allow: 12-48 months (or more where appropriate)

4. Compliance line: Minimum wage protection; commuting use

5. Leavers: What happens, how you settle

6. Ownership: Options at end of hire (make the 'own-it-later' route crystal clear)

7. Approvals: Aim for 2-3 business days, max

Give managers a short email template, posters for hubs/offices, and intranet copy. Then point everyone to the calculators so they can see real money:

• Employee savings calculator

• Employer benefits calculator

For a broader ‘why now?’ context, the 2024 Mobilityways Commuter Census shows solo driving still dominates, while cycling participation needs a push, exactly what an e-bike-friendly cap delivers.

Reporting & impact: prove your cycle to work scheme limit is working

Track the things leaders care about:

• Participation rate and average package value

• Employer NIC savings (as a quick rule of thumb, many employers model ~£150 saved per £1,000 processed)

• Estimated CO₂ avoided and calories burned

• Shifts from car to bike/e-bike (stories + stats)

• Punctuality and parking pressure (anecdotes + trends)

DfT’s walking and cycling collection is a useful reference point for contextual stats and trend lines through the year.

Case in point: raise the cap, raise participation

Here’s the pattern we see again and again. Start with a £1,000 cap and you’ll get interest, mostly for non-electric bikes. Lift the cap to £2,500-£3,000, and suddenly, longer-distance employees can pick capable e-bikes. Uptake rises. Car trips fall. Punctuality improves.

That’s not theory; it’s the everyday reality we hear from employers after they increase their cap and keep terms flexible.

If you want a human read on the experience from a rider’s point of view, Cyclescheme has a round-up of real-world benefits for both employers and employees here.

Why choose Cyclescheme when you set your limit

You want simple, compliant, and trusted. Cyclescheme’s been doing this for 20 years, is trusted by 50,000+ employers, and gives your people the biggest choice via 2,600+ retailers, including local independents, big names, online, and even brand-direct. It’s free to join, cost-positive via Employer NIC savings, and built for e-bike-friendly limits that actually change commutes. 

Implementation checklist: set your cycle to work scheme limit

• Pick your cap(s): One number or a simple two-tier model (standard + e-bike)

• Define terms: 12-48 months; accessories included

• Write the one-pager: Eligibility, approvals, leavers, ownership

• Set up with Cyclescheme: Registration, your cap, and approval workflow

• Launch comms: Email + intranet + posters + manager brief

• Share tools: Savings calculator (employees) and benefits calculator (employers)

• Track results: Use your dashboard to watch uptake and savings

• Review in 3-6 months: Gather feedback; adjust cap or terms to widen access

Set a limit that unlocks cycling, not one that blocks it

There’s no hard legal cap. You choose the cycle to work scheme limit that serves your people. Pair a sensible cap with flexible terms, keep your policy to one page, and make e-bikes an easy 'yes'. Use Cyclescheme to keep the admin light, the savings real, and the experience joyful.

When you pick a number, you’re not just writing a policy, you’re shaping how your team moves, how they feel when they arrive, and how your workplace works. Pick the number that moves people.

FAQs: Cycle to Work Scheme Limit

What’s a sensible starting cycle to work scheme limit for mixed workforces?

If you want broad access (including e-bikes), £2,000-£3,000 is a practical band. It covers quality e-bikes and commuter kit without overwhelming payroll.

Can I run different cycle to work scheme limits for different sites?

Yes. If one site has hilly terrain or limited public transport, you can set a higher e-bike cap there. Document the reasoning once, apply it consistently.

How often should I review my cycle to work scheme limit?

Every 6-12 months. Check uptake, staff feedback, and retailer price movements (e-bike tech and prices shift). Adjust terms before you raise caps if affordability is the blocker.

Does a higher cycle to work scheme limit increase fraud risk?

Not if you run standard checks: employment status, minimum wage protection, and approvals. Certificates redeem only at approved retailers, which adds control.

Should accessories count toward my cycle to work scheme limit?

Yes. Locks, lights, mudguards, panniers, and clothing remove everyday barriers, making commuting habitual rather than nice when the weather’s perfect.

What repayment terms work best with a higher cycle to work scheme limit?

Longer terms (24-48 months where available) open access for lower earners and keep monthly deductions comfortable without changing your headline cap.

How do I explain the cycle to work scheme limit to managers?

Give them one paragraph and a number e.g. “Our cap is £X. It covers bikes/e-bikes + commuting kit. Terms are 12-48 months. Minimum wage checks apply.”

Can I set a separate limit for cargo bikes?

Absolutely. If deliveries, site-to-site trips, or equipment loads are common, a cargo-bike tier can replace pool cars and mileage claims.

What if employees work hybrid? Does the cycle to work scheme limit still make sense?

Yes. Hybrid patterns still benefit from e-bike options. A slightly higher cap plus flexible terms make part-week bike commuting an easy habit.

How do I show leaders the impact of raising the cycle to work scheme limit?

Track participation, average package value, Employer NIC savings, CO₂ avoided, and punctuality. Present a 'before vs. after' comparison one quarter post-change.