Electric Car Salary Sacrifice

A salary sacrifice car scheme enables an employee to drive a brand new, cost-effective electric car through their employer for a great deal less than if they had leased it privately.

The employer leases a tax-efficient zero-emission electric car, which it provides to the employee as a company car in return for the salary sacrifice.

As sizeable VAT savings may also be available, the employee can access green, zero-emission cars at a fraction of their normal cost, and employers also benefit from potentially significant monthly NIC savings.

And for employers who operate a grey fleet, because increasing company car tax on traditional petrol and diesel cars has encouraged drivers to take the cash alternative, a salary sacrifice scheme is an ideal way to reduce Duty of Care risk and reduce your company’s carbon footprint.

• An attractive employee benefit without increased costs
• Not restricted to just larger fleets
• Compared to sole supply, our multi-bid funding solution significantly reduces costs
• Generates monthly NIC savings
• Electric vehicles help reduce fuel reclaim costs
• Encourage cash allowance takers back into company cars
• Reliable and fully maintained cars reduce the risk inherent in grey fleet
• Helps reduce your carbon footprint
• A valuable benefit that is available to all employees
• Increases employee engagement, motivation and retention

Our electric car salary sacrifice scheme provides you with a brand new, cost-effective electric car for a lot less than if you were to lease one privately. In essence, your employer leases the tax-efficient zero-emission electric car, which it then provides to you as a company car in return for a small salary sacrifice.

As the cost of the car is deducted from your gross salary, income tax and National Insurance Contributions are based on the lower, revised salary, thus reducing the income tax and NIC you pay each month.

In addition, because your employer may be able to recover the VAT on the rental and maintenance costs it pays, which you can’t recover if you personally lease a car, you may be able to enjoy even greater savings.

• Access to a brand new electric car at a fraction of the normal cost
• Significant income tax, NIC and VAT savings
• No up-front costs or credit checks
• Reduced fuel costs
• Flexible mileage and terms to suit you
• Maintenance and breakdown cover included
• Fully comprehensive insurance provided
• Enjoy the experience of driving a green, zero-emission vehicle
• You’ll be contributing to a cleaner environment for you and your family

Absolutely. Salary sacrifice works particularly well for fully electric cars due to the extremely low levels of Benefit in Kind (BiK). As your salary is effectively reduced, you pay less Income Tax and National insurance. Fully comprehensive insurance and vehicle maintenance is also included, plus there’s no up-front payment. These factors combined make salary sacrifice more cost-effective than a private lease and effectively offset the small additional BiK cost.

You formally agree to sacrifice part of your gross salary and in return, your employer provides you with an electric car of your choice over a period of two to four years. You enjoy all the benefits of a company car such as fully comprehensive insurance and vehicle maintenance, plus you also benefit from the extremely competitive leasing rates Fleet Alliance provide to your employer. All you need to do add is electricity which is significantly cheaper than filling up with fuel. Plus you’ll be doing your bit to reduce global warming.

No. Our salary sacrifice scheme has been specifically optimised for electric cars as they deliver the maximum cost savings available. Hybrid vehicles emit some CO2 and cannot travel as far in fully electric mode; therefore, they attract a higher rate of Benefit in Kind (BIK) in comparison to electric cars making them less cost-effective.

We offer every electric car currently available, and the list is growing by the day. You can configure your car to your exact specification from colour and trim to alloys and in-car technology. If the manufacturer can build it, and it fits your budget, you can drive it.

After the car has been delivered your employer will inform HMRC that you have been provided with a company car. HMRC will then arrange for your tax code to be changed so that the income tax can be deducted from your monthly pay. This may take several weeks, but it is possible this may be speeded up if you amend your own tax code via HMRC’s online portal.