Companies are often faced with the decision of whether to purchase company bicycles for their employees. The question of whether to purchase or lease them involves various considerations that depend largely on the company's framework conditions and preferences. Let's take a look at the options.
With a purchase, a company acquires the bike and makes it available to the employee. This approach allows the company to claim the purchase price against tax over a period of seven years and also reclaim the VAT. However, this method involves considerable acquisition costs, especially for larger requirements, and ties up capital that could be utilised elsewhere.
The company bike leasing option, on the other hand, requires less capital commitment and therefore initially has less of an impact on liquidity - an attractive option for young companies in particular. Company bike leasing can offer financial benefits according to certain calculations. Company bike leasing can be up to 40 per cent cheaper than a traditional bike purchase. It also relieves the company of administrative tasks, as lessors often integrate maintenance and insurance services.
There are three possible options for the company bike - here is an overview:
E-bikes are becoming increasingly popular in Germany. According to Statista, 2.2 million e-bikes were sold in Germany in 2022 - that's ten per cent more than in 2021. E-bikes are being used more and more frequently, especially as company bikes via employers. They are highly attractive for use in the vehicle fleet, not least from an environmental perspective. They can help to reduce the company's carbon footprint - which is crucial in terms of the upcoming CSR reporting - and ease the car park situation at the company location. Employers and employees can benefit from e-bike leasing in particular. Companies can also benefit from tax write-offs and possible subsidies. However, it is important to note that subsidised e-bikes must remain part of the company's assets for a certain period of time.
It is important to note the different categories of e-bikes. Pedelecs are legally classed as bicycles, as they provide assistance up to 25 km/h, while S-pedelecs are classed as mopeds and the corresponding regulations apply. Companies must therefore also ensure that e-bikes comply with safety regulations and carry out regular checks.
Employees can pay the leasing instalments for a company bike directly from their gross salary through salary conversion. This model brings tax advantages for employees and employers, as it reduces taxable income. However, it is important to consider the non-cash benefit of private use, which has been tax-privileged for certain bicycles and e-bikes since 2020.
Despite the benefits of leasing, including financial savings and included maintenance services, it is important to be aware of the long-term commitment and potentially limited choice. Contracts should be carefully scrutinised to ensure that the offer meets the company's long-term interests.
The same tax regulations apply to company e-bikes that can travel faster than 45 km/h as to company cars. However, the legislator is promoting the use of electric bicycles with tax incentives until 2030.
The choice of whether a company purchases or leases company bikes should be made after careful consideration of all factors - both financially and in terms of sustainability goals and legal requirements.
