Leasing a company bike versus a company car
More and more companies want to offer their employees an extra benefit on top of their monthly salary. Until now, the company car has been one of the most popular ways to make the pay package more attractive for employees. The employee exchanges gross salary for a car that is exempt from payroll withholding tax and social security contributions. A company car is a benefit in kind. However, the company bike is gradually gaining popularity, as mobility and our ecological footprint are high on the political agenda.
Does the car continue to dominate commuting?
Traffic congestion is becoming increasingly burdensome for many of us. In the past, you would only get stuck in traffic during the morning or evening rush hour on the Brussels ring road. Today, you can find yourself at a standstill on that same ring at any time of day. There are simply many of us, and it keeps getting busier. The number of cars is also rising year after year. In 2019, Statbel counted no fewer than 5,889,210 passenger cars in Belgium.
Of all these passenger cars, 10% account for the number of company cars. Xavier May and Thomas Ermans both studied how many company cars are in circulation in Belgium and where they are geographically located. This research shows that between 550,000 and 670,000 company cars are on the road. These are mainly concentrated in Flanders and around Brussels.
If we were to succeed in replacing all company cars with company bikes, there would be 10% fewer cars on the road in Belgium. However, this may not be the solution to the problem. Of all the cars on the road, company cars are the least polluting. They are replaced on average every four years by newer models equipped with more efficient engines, or better still, electric and hybrid vehicles. The most polluting are older diesel engines and SUVs, heavy and powerful sporty cars. These are truly harmful to our environment.
According to Cyclobility, a better solution is, on the one hand, the combination of a company car and a company bike, and on the other hand, offering a company bike to people who are not eligible for a company car. The research by Xavier May and Thomas Ermans shows that 13.5% of employees in Belgium are privileged with a company car. Ideally, these individuals should also be able to include a company bike in their mobility budget, in combination with a smaller company car. For short trips or on sunny days, they will be more inclined to choose the bike instead of always opting for the car.
According to the Netwerk Duurzame Mobiliteit, the average commuting distance of people in Flanders is 17.925 kilometres (distance between home and workplace). This means that many employees commute less than 18 km to work. If they have the option to lease a company bike, we can take a significant step forward towards sustainable mobility.
Cyclobility ensures that employees can lease a bike through their employer . They take care of everything for the cyclist by offering all conceivable services. Insurance, maintenance, repairs and VAB roadside assistance are included in the lease package. At Cyclobility, the bike is even delivered to your home! After the lease term, the employee can return the bike to Cyclobility at no extra cost. He or she also has the option to purchase the bike by paying the remaining value.
Like the company car, the company bike is exempt from payroll withholding tax and social security contributions. The lease amount is deducted from the employee’s gross salary. Moreover, you don’t have to pay expensive fuel costs and, at most companies, you can even earn a cycling allowance . Deloitte ranked the (electric) company bike at the very top of its “Top 20 alternative remuneration forms” in 2018.
Company bikes, in all shapes and sizes
For many of us, the company car is also a convenience in our private lives. Think of doing groceries or dropping the kids off at the school gate. Thanks to the electric cargo bike, this problem is easily solved. Cyclobility also offers electric speed pedelecs in its bike leasing range that can reach speeds of up to 45 km/h. The Riese & Müller Load 75, for example, is an ideal alternative for larger families.
Company bikes for your business
Offering company bikes for your business can be cost-neutral. Salary exchange is the most common form of bike leasing in Belgium. The employee gives up part of their gross salary in exchange for leasing a high-quality company bike. The only condition is that the employee’s salary does not fall below the minimum wage scale. If this would be the case, other gross bonuses can also be used. A deduction from the end-of-year bonus is also an option and is likewise a gross deduction. When the company provides a mobility budget, the (electric) bike can also be (partly) included in it. In that case, it is possible to opt for a smaller company car and include a bike in the package. At present, this budget is mainly used for the company car. If you are a truly generous employer, you can also choose to offer your staff an “extra benefit on top.” In that case, the company bike is of course not cost-neutral for the employer.
Would you, as an employer, also like to offer company bikes? Contact Cyclobility and we will help you from A to Z in setting up a bike leasing programme that closely matches your company policy.
