How company bike leasing works for employees

Almost one million people in Germany have a leased company bike from their employer - and the trend is rising. The offer is worthwhile for employees: they can afford a high-quality bike or an e-bike or pedelec, which would otherwise have been too expensive for them.

With company bike leasing, employers procure a bike from a leasing provider that employees can also ride privately. In return, employees forgo a small portion of their salary each month, corresponding to the leasing instalment. At the end of the leasing period - usually after two or three years - employees can take over the bike at a favourable residual value. Depending on the provider, employees can make savings of up to 40 per cent.

We explain how bike leasing for employees works and what employees need to look out for.

Cooperation between company and leasing provider

Company bike leasing for employees requires that the company has a cooperation agreement with a leasing provider or offers its employees the NAVIT mobility budget as an employee benefit. We have summarised all the information on the detailed procedure for how employers can implement company bike leasing in this article.

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Why lease a company bike instead of buying one?

Employees benefit twice over when leasing a company bike: firstly, they don't have to pay the full purchase price for the bike at once and secondly, they can also save up to 40 per cent compared to a private purchase by leasing through salary conversion.

Company bike leasing as a salary supplement (0% rule)

  • Leasing instalment paid by the employer.
  • Via a leasing instalment in addition to salary: private use including commuting to work is tax-free.

Company bike leasing via salary conversion (0.25% rule)

  • Leasing instalment paid via salary.
  • No wage tax, but non-cash benefit (private use) taxable at 0.25% of the gross list price.

Low leasing instalments instead of a high purchase price

Basically, if you want to buy a new bike, especially an e-bike, you first have to spend a lot of money. This is not the case with bike leasing, as there is no high one-off payment and employees pay a monthly leasing instalment instead. The actual costs depend on the salary and the purchase price of the bike or e-bike. With some providers, the costs and savings can be calculated using a leasing calculator.

Benefit from tax advantages through salary conversion

Company bike leasing for employees, which companies can offer in collaboration with NAVIT and its partners, has another advantage: financial processing via salary conversion.

With salary conversion, part of the gross salary is converted into the company bike or the leasing instalment, which pays off for tax purposes. With salary conversion, employees waive part of their salary and in return receive the bicycle or e-bike for private use for the contractually agreed term. As this reduces the gross salary, employees pay less tax and social security contributions. They receive a new, high-quality bicycle or e-bike and save up to 40 per cent compared to buying a new one privately.

Alternatively, companies can make a significant contribution to the leasing costs and use the company bike as an attractive bonus on top of the salary. Such an employee benefit can reward committed employees and attract potential future employees.

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How company bike leasing for employees works with NAVIT

Bike leasing for employees works digitally and intuitively. Employees can lease a bike or e-bike with NAVIT in just four steps.

Step 1:

The company registers with NAVIT and receives personalised access to the digital NAVIT mobility platform. All employees can use a registration link to log in to the NAVIT app free of charge and without obligation.

Step 2:

In the NAVIT app, employees register for bike leasing via the integrated leasing provider's bike leasing portal. Employees choose whether they want to select their company bike from a local specialist dealer, online or from a direct provider. The respective dealer enters the offer in the bike leasing portal, where it is automatically stored in the employee profile so that the employee can view it in the NAVIT app.

Step 3:

Employees can then accept the leasing offer in the platform. The leasing contract is created automatically with a click, which employees can also sign digitally. This contract regulates the terms of use for employees and also sets out the leasing instalment. As soon as employees have signed the leasing agreement, the offer is forwarded to the HR or benefits officer in the company for review in the leasing portal.

Step 4:

Once the company has approved the leasing contract, the bike dealer prepares the bike or e-bike for collection or dispatch. As soon as the bike has been dispatched or is ready for collection, the employees are notified and can set off as soon as they receive it.

Bike leasing with NAVIT - digital, simple, practical

The leasing process via NAVIT and its leasing partners is digital and intuitive. The optimised processes save employees time and effort. NAVIT supports companies and employees from registration to leasing and beyond.

Employees can apply for company bike leasing via the NAVIT APP. They select the bike or e-bike, including accessories, from one of over 5,000 dealers. The local dealer takes care of preparing the offer via the bike leasing portal. Once the offer has been confirmed and the bike is in stock, employees can collect the bike.

The term of the bike leasing contract is 36 months. The monthly leasing instalments are converted from the gross salary via salary conversion.

NAVIT's leasing partners offer all-round protection for the company bike with fully comprehensive insurance including a mobility guarantee and an annual inspection, with an additional full service package on request. This means that employees are also well protected in the event of damage or theft.

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Stefan Wendering
Stefan is a freelance author and editor at NAVIT. Previously, he worked for startups and in the mobility sphere. He is an expert in urban and sustainable mobility, employee benefits, and New Work. In addition to creating blog content, he also produces marketing materials, taglines, and website content, as well as case studies.
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