Foreword

By Marijke Bron, Sales Director at ALD Automotive

“With an e-bike you can cover longer distances quite easily and because it is affordable, it is an attractive means of transport to add to your mobility policy. The developments of recent years, with people working more from home and making more use of individual transport, mean that we need to organise our mobility differently.

What are the advantages of a company e-bike for both your company and for your employees? What forms of leasing are there, and what are the tax implications? Interesting questions that we answer in this e-magazine.

In short, this magazine offers you a number of useful tools for integrating the e-bike into your mobility policy. And if you would like to learn even more, we look forward to getting in touch with you soon.”

Marijke Bron_silhouette

How do you facilitate e-bike use?


If you want to establish an e-bike scheme, you can do this in a variety of ways. We are happy to tell you more about the various (lease) types and their features.

Business lease

With a business lease, the employee uses the e-bike for commuting. The e-bike is provided by the employer and the employee may use the e-bike for private purposes without any tax restrictions. The employee pays an additional tax liability of 7% of the recommended retail price of the e-bike.

It is a full operational lease contract. So the employee rides an e-bike for a fixed amount per month, including service and maintenance, a replacement bicycle in case of repairs, and roadside assistance.

Go directly to the fiscal guide for company e-bikes

 

Private lease through the employer

With a private lease contract, the employee pays a fixed monthly amount to lease an e-bike. In the case of an e-bike – as with a private lease contract for a car – the contracting party also knows in advance exactly what the monthly costs will be, meaning that they do not have to worry about extra costs for insurance, tax and maintenance. With a private lease contract, the employee does not have to pay an additional tax liability, and is entitled to a tax-free reimbursement of travel expenses incurred.

Compensation for a personal bicycle

An employee who has bought his/her own e-bike and (also) uses it for commuting to and from work is the full owner of the bicycle and thus also responsible for insurance and maintenance costs of the bicycle.

However, as an employer, it is possible to compensate the employee by paying part of the purchase price. This payment is then considered as employee salary and is subject to payroll tax and contributions.

Alternatively, the employer also has the option to pay these tax-free under the work-related expenses scheme (WKR).

Tax guide for company e-bikes

The purchase of an e-bike is often a considerable expense for employees, which is why a lease arrangement for an e-bike could be most welcome. For employees, the use of a ‘company bicycle’ is also extremely attractive from a fiscal point of view, with the arrangements for one having become considerably more straightforward for employers.

In the past, the fiscal complexity surrounding leased bicycles was related to the private kilometres that also had to be taxed. However, this has been done away with in the new scheme, which makes things a lot simpler. There are, of course, still a number of things employers need to bear in mind. The most important of these are listed here.

7% additional tax liability

As an employer, you can provide an e-bike that the employee can use for private purposes without limitation. Instead of withholding taxes per (private) kilometre ridden, there is now a fixed 7% additional tax liability on the consumer price determined by the manufacturer. This makes the lease bike an attractive option within the mobility policy.

Suppose the employer provides an e-bike with a consumer price of €1,999 including VAT. The annual additional tax liability is then 7% of €1,999, in other words €139.93 gross per year. Per month, this amounts to €11.66 gross and – depending on the amount of the gross monthly salary – about €4.50 to €6.00 net per month.

When is there no additional tax liability?

If an employee really only uses the e-bike for business trips – during working hours – this does not have to be taxed, meaning there is no need for the employee to pay an additional tax liability. In many cases, however, the employee will also want to use the e-bike for commuting, which often involves private kilometres as well. As this is difficult to log and monitor, the tax authorities have decided to always incorporate leased bicycles used for commuting into the additional tax liability. The employee then pays an additional 7% tax liability on the set consumer price of the e-bike.

Combining with a company car

You are allowed to combine the e-bike with a company car. The additional tax liability percentages remain the same for both the e-bike and the car. An exception to this rule is when it turns out that the employee only uses the car for private purposes. In such cases, the tax authorities may determine a higher additional tax liability for the car.

Processing in the payroll administration

There are three ways to process the additional tax liability for a company bicycle in the payroll administration, with the best solution varying from organisation to organisation.

  1. The additional tax liability is processed in the payroll administration. This leads to an increase in taxed salary, so that withholding taxes are deducted from the pay slip.
  2. The additional tax liability can be processed in the work-related expenses scheme scheme (WKR) of the withholding taxes. This is an attractive option for employees. The WKR has a so-called ‘free margin’ for fringe benefits, which ensures that this salary (the additional tax liability in this case) does not have to be taxed. Since 2020, this free margin has been increased to 1.7% on the first €400,000 of the company’s total wage bill. Above that, the regular 1.2% applies. If the free margin has already been used up, a final 80% levy applies for the employer on the amount above the free margin. If the employee pays a personal contribution for the e-bike, this amount can be deducted from the additional tax liability.
  3. Employer and employee can also together opt to include the e-bike in a cafeteria plan. Here, the employee surrenders (taxed) gross salary and receives an e-bike in kind in return. Thanks to the 7% additional tax, this salary in kind is taxed at a lower rate than the surrendered gross salary.
What happens to the travel allowance?

When an employee leases an e-bike for business purposes, thus using it for commuting and business trips, this is considered ‘transport on behalf of the employer’. The employee cannot, therefore, receive an untaxed travel allowance for the kilometres travelled on the e-bike.

However, for other days when the employee does not travel to work with the business e-bike (for example, with his/her own car or by train) a mileage allowance may be given on which no tax is payable (maximum of € 0.19 per kilometre). This is a mutual agreement that you make with your employee, who, in turn, should be able to provide receipts for journeys travelled by train or car.

Self-purchased e-bike

Employees who commute using a bike that they have purchased themselves or leased privately through the employer do not pay any additional tax.7

However, they are eligible to receive the usual travel allowance (up to €0.19 per kilometre tax free) for trips with this e-bike.

shutterstock_1860111493 (FILEminimizer)

For commutes up to 22km, an e-bike is a good alternative to a car

Purchase or lease an e-bike?

What are the differences in costs for employers and employees when leasing or purchasing an e-bike?


Private purchase
  • Employee costs: purchase cost and variable expenses for maintenance, service, and insurance.
  • Employer costs: can reimburse travel expenses up to €0.19 per km tax free. Optional: reimbursement of purchase cost (taxed).

 

 


Lease

Business lease

  • Employee costs: additional tax liability of 7%.
  • Employer costs: fixed rate per month, inclusiding maintenance/service/insurance costs.

Private lease

  • Employee costs: fixed rate per month, including maintenance/service/insurance costs.
  • Employer costs: can reimburse travel expenses up to €0.19 per km tax free.

 

Interview with Danielle Kruger, HR director at ALD Automotive

Together with her colleagues in the HR department, it is Danielle’s job to keep employees moving in a healthy and sustainable manner. The e-bike thus plays an important role at ALD Automotive. Danielle talks about her own experiences with incorporating e-bikes into a mobility policy and what employers can do to promote e-bike use.

Why do e-bikes fit so well with a sustainable and healthy mobility policy?

An e-bike is a wonderful addition to your mobility. You can cover much greater distances with an e-bike than with a regular bicycle. The fact is that if you have an e-bike outside your door, then you are more likely to leave your car at home. And cycling is healthy, of course. Though you do have pedal assistance with an e-bike, you still have to power it physically. This has a proven effect on your vitality. An e-bike fits in well with the healthy lifestyle that more and more people are adopting.

What other advantages does an e-bike offer?

Our research has shown that 15 per cent of employees are prepared to (partially) give up their parking space if they can make use of a company e-bike. Of course, that is a very smart way to save on mobility costs.

Other employees indicated that cutting down on their commute time is very important, so my advice is to clearly demonstrate to employees how much time they can save by cycling on an e-bike or high-speed e-bike.

Who is a company e-bike suitable for?

Some people may still have a certain image of the electric bike,  but there are now such beautiful and sporty models that you can really make a great impression. A company e-bike is particularly suitable for employees who do not wish to make a very large purchase. But by leasing an e-bike, they also opt for convenience; you have a good bike with maintenance included so there is no hassle. The e-bike is ideal for employees who like to exercise but do not find regular bikes sufficiently comfortable and prefer not to come to work sweaty. And finally, we always get feedback from people saying that they love to be outdoors.

ALD Automotive recently conducted its own e-bike pilot scheme. Why is that, and what can you tell us about it?

It’s very simple: we also value sustainability and the health of our employees. Furthermore, we conducted a pilot programme so that we could see for ourselves what it is like to commute using an e-bike. We can claim that the e-bike is a good mode of transportation, but you also have to know what you’re talking about, so ‘practice what you preach’.

We reviewed employees’ postcodes to find out how far they live from work. This showed that, based on the distance, 40 per cent of them qualified for an e-bike. They were given an e-bike to use for three months, which the majority of them were very enthusiastic about, despite the fact that the weather was not always great during this period.

What did you learn from this pilot programme and what advice would you thus give to other employers?

Primarily that it is good to let employees become familiar with e-bikes. For the most part, the people who have tried out an e-bike don’t want to go back to using anything else. If the weather is bad then they will logically prefer to choose an alternative means of transport. You could assist employees with such situations by, for example, including rainwear in the offer. But, as far as I’m concerned, freedom of choice also comes into play here. The e-bike fits well into a range of mobility options: you can ride your bike and when the weather is bad you can drive your car or take public transport. That is ideal!

What factors are there to consider when making e-bikes available?

Depending on the distance that an employee has to travel, you can choose between the low-speed and the speed pedelec.

There are also a number of practical issues to consider. For example, is there a good place to store the e-bike and is it safe? Or is there a space at work where the employees can freshen up a bit?

Finally, do you think that employers should do more to promote e-bikes among employees?

Yes, absolutely. It is increasingly important to keep employees moving. And with COVID-19, vitality has become even more important than it already was. Both companies and their employees can reduce costs when they take advantage of a bike lease. We have to encourage people to search for alternatives and this can be done by letting them try them out. As management, you occupy an exemplary role. So take an active role yourself, show that you think it’s important, and share your stories with each other!

Step-by-step guide

Ben je overtuigd van de voordelen van de e-bike? Wat kun je vervolgens doen om e-bikes succesvol te implementeren in je mobiliteitsbeleid? Een kort stappenplan:

Are you convinced about the benefits of the e-bike? What can you do next to successfully implement e-bikes into your mobility policy? A short, step-by-step guide:

1. Analyse commuting distances and the needs of employees

As a company, it is easy to gain insight into your employees’ commuting distances by looking at which postcodes they live in. You can develop a plan based on this information.

Commutes of up to 10 to 15km can easily be covered on an e-bike. For commutes in excess of 15km, time also becomes a factor and the speed pedelec is a better choice. Some employees even cover up to 50 km on the speed pedelec. The latter cases are exceptions, but based on employee profiles, a suitable solution can be found for everyone.

It is also advisable to gain insight into the needs of employees by conducting a short survey, for example. In this way, you can also take their wishes into account in your proposal.

2. Facilitating e-bike use in general

Providing a company bicycle is one thing. But it is also advisable to think about additional facilities. For example, it makes things easier if the e-bike can be stored safely, there are charging points at the office, and if there are perhaps facilities for freshening up or even showers available for your employees. Furthermore, look carefully at the target group. In general, Dutch people already own a bicycle. But if you employ a lot of expats, it is important to offer them an attractive bicycle plan.

3. Start an incentive programme

In the event of major changes and transitions, it is easier to bring about behavioural change, with the current COVID-19 circumstances being a perfect example of this. Employees will be more open to new habits and initiatives, meaning they will be more receptive to a company bicycle. Others may need more persuasion.

What can you do to encourage employees? For one example, you can offer a higher travel allowance per km for the bicycle than for the car (untaxed max of 19 euro cents per km). There are also various apps that encourage employees to cycle because they can see the health benefits in real time.

4. Take the time for the fiscal aspects

With a company bicycle you can choose between various (lease) forms; business lease, private lease, or purchase. Each type has its own tax regulations. Reserve enough time to compare the tax advantages and disadvantages. And check your final bicycle plan with a tax expert so that you are well prepared.

Some of the lease offerings
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  • riese_e-bike-3
  • qonqer_e-bike-3

Are you interested or would you like to find out more?

ALD Automotive will be happy to advise you about the possibilities of leasing an e-bike. You can contact our leasing consultants at info.nl@aldautomotive.com or by calling +31 (0)20 658 70 00. We will be happy to help you.

Or why not take a look at our full range of lease offerings?

Mobility
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