Ride-to-work program hits the sweet spot
New ride-to-work program hits the sweet spot
The quest to get more New Zealanders on bikes is gaining momentum, thanks in large part to new ride-to-work programme, the Wheel Deal, which makes it simple for employers, passes on huge savings to staff, all the while ensuring retailers don’t lose out in the process.
The Wheel Deal enables employers to support their staff to buy a bike, e-bike or e-scooter through pre-tax salary sacrifice. This, coupled with the removal of Fringe Benefit Tax, reduces the cost of a $5000 e-bike to around $3,500.
Co-founder Michael Tritt is pleased with the response to date, with dozens of workplaces already on board. He is glad that salary sacrifice arrangements, common in Europe, are now gaining traction in New Zealand workplaces. He says, “Removing the barriers to buying a bike or scooter is a great way for a business to make good on their sustainability and wellbeing goals and be known as a workplace that walks the talk.”
What differentiates the Wheel Deal is that it has limited impact on dealer margins. Michael says, “We’re here to support New Zealand's entire cycling ecosystem, where bike retailers play a crucial role.”
When asked what else the Wheel Deal does differently, Michael says, ‘We make it really simple for employers. There’s only one purchasing option available and it’s a 12-month salary sacrifice. Our documentation has been put together by experts and there’s no ambiguity as to who owns the bike at any point. The ownership of the bike is transferred to the owner from day one.”
While each employer is different, the Wheel Deal helps them to anticipate demand from their staff and tailor the programme in accordance with their cashflow situation, often in a phased way with a cap on the purchase price of a bike or scooter.
Co-Founder Dan Wallace says the response from bike retailers around the country to date has been overwhelmingly positive.
“An individual is free to choose a bike through any retailer in New Zealand via the Wheel Deal – they’re not limited to any particular brand or store which often surprises people. We're also completely transparent about our business model. This is key.”
“When someone buys a bike through the Wheel Deal, they also get two free maintenance check-ups. It might seem like a small gesture, but it’s a really important way of building relationships with local bike retailers.”
Looking ahead, Michael sees bike/scooter purchasing schemes via salary sacrifice being a standard employee benefit, like it is already in many other parts of Europe.
He says, “It’s taken a bit for Kiwis to get their head around an employee benefit of this sort, but it’s certainly a concept gaining momentum, and early adopters will reap the biggest rewards.”
More information about the tax and bike purchasing in New Zealand can be found at: https://www.deloitte.com/nz/en/services/tax/perspectives/july-2024-fbt-and-the-bike-exemption.html
