22 August 2025

First things first: what's an E-bike?

Accountants and tax professionals may find clients approaching them with increasing regularity in connection with how best to provide employees with E-bikes. The main issues facing advisers are understanding how to differentiate an E-bike from a moped or a classic bicycle/tricycle and helping the client to decide whether they can be provided under a ‘cycle to work’ salary sacrifice scheme which carries tax benefits.

Definition of an E-bike

The official term for an E-bike is an electrically assisted pedal cycle (EAPC). They can be two- or three-wheeled bicycles or tricycles which are propelled by a combination of the rider and an electrical motor.

To qualify as an EAPC, the E-bike must meet the following criteria:

  • Pedals must be able to propel the bicycle
  • The electric motor must not exceed 250w of continuous rated power
  • Once a speed of 15.5mph is reached (only permitted if the E-bike is approved), the electrical assistance function must automatically switch off

Speed restrictions and reclassification risks

Part of the approval process for an E-bike is the restriction on speed to a maximum of 15.5mph. It’s vital, to preserve them as E-bikes, for the motor not to be de-restricted to enable the E-bike to travel in excess of this limit.

If that happens, the E-bike becomes a moped or motorcycle, and:

  • The regulatory status and tax status change
  • The rider’s minimum age requirements apply:
    • 16 for mopeds and scooters up to 50cc
    • 17 for motorbikes up to 125cc
  • Riders must pass road safety tests, wear a helmet, and purchase tax and insurance

Who can ride an E-bike?

Anyone over the age of 14 can legally ride an E-bike, if it’s classified as an EAPC. E-bikes do not need to be registered, taxed, or insured.

  • Riders are not subject to road safety test requirements
  • E-bikes can be ridden anywhere traditional bicycles can, but not on pavements
  • All cyclists must still follow the Highway Code

Quite how this, and the approval process, is policed is anyone’s guess. For the purposes of this article, I will call it a form of self-assessment.

A debate was sparked by a recent Panorama programme (available on BBC iPlayer), with Cycling Weekly and others unsurprisingly pushing back.

E-bikes and tax

Employers are permitted to provide cycles and EAPCs tax-free to employees under the cycle to work scheme.

Additional Tax Points

  • Any bicycle or E-bike not provided through a cycle to work scheme is treated as a benefit in kind
  • Capital allowances can be claimed when E-bikes or motorcycles are purchased for employee use
    • Sole traders can also claim them, but allowances are restricted if privately used

Approval and markings

To qualify as an EAPC, markings on the bike must show:

  • The continuous rated power output
  • The bike manufacturer
  • And one of the following:
    • The battery’s voltage, or
    • The maximum speed the motor can propel the bike

If an E-bike was first used before January 2016, the purchaser should contact the Driver and Vehicle Licensing Authority (DVLA) to check if it’s classified as an EAPC.

Special Case: 'Twist and Go' Cycles

‘Twist and go’ cycles, powered by an accelerator built into the handlebars, must:

  • Have been approved as EAPCs by the Vehicle Type Approval Authority
  • Be classified as low-powered mopeds at the manufacturing stage of production to qualify

Links corner

  • Riding an electric bike: the rules - click here
  • Riding a motorcycle, moped or motor tricycle - click here
  • Panorama (BBC iPlayer) - click here
  • Independent cycle traders 'hate the division' that BBC Panorama e-bike documentary 'tried to sow' - click here
  • Cycle to Work Scheme Guidance for Employers - click here
  • Vehicle Type Approval - click here
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