The rapid growth in Salary Sacrifice Schemes and what you need to know.
There is one very hot topic in the UK world of automotive at the moment, and it revolves around electric vehicles and the tax savings you and your employees/clients can access through making the switch to electric.
What is Salary Sacrifice?
Often called Salary Sacrifice, rather than the perhaps the more correct term ‘Salary Exchange’, HMRC says it relates to “an agreement to reduce an employee’s entitlement to cash pay, usually in return for a non-cash benefit”.
So far, so very HMRC in its language. When it relates to cars it means taking the costs of your car (that is all your costs, including maintenance, tyres, lease and insurance), pre-tax, meaning you save the tax you would have paid on that income. You do pay a small Benefit in Kind tax for this benefit, but for electric vehicles, the tax is minimal, as part of the UK Government’s plan to accelerate the switch to zero emissions.
Great employer benefits
- Adoption of a Salary Sacrifice scheme will strengthen your company brand.
- A real way to demonstrate your commitment to tackling the climate crisis.
- You’re in a stronger position to attract and retain great people.
- A reduction in your employer National Insurance contributions.
- The best schemes allow you for very little involvement from the employer.
Great employee benefits
- Accident management should it be needed.
- Full insurance cover throughout the contract included in the price.
- All servicing, maintenance and tyres are included in the contract, giving them peace of mind.
- Choice of ever-increasing electric vehicles, including brands such as Tesla, Volkswagen, Jaguar, Volvo, Peugeot and Seat.
- Roadside assistance – 24/7, 365 days per year – whenever you need it.
- A positive move to reducing your carbon impact.
At P+B we have a team dedicated to supporting you in the adoption of a Salary Sacrifice team. If you'd like to arrange an introductory call please fill out the form below and one of our expert team will be in touch soon. We're here to make the process faster, simpler and much more enjoyable!
