SALARY SACRIFICE SCHEME - ALL YOU NEED TO KNOW

How does salary sacrifice work?

In a salary sacrifice scheme, employers partner with third-party car leasing companies to offer employees a vehicle in exchange for a monthly contribution from their salary before tax is applied. With most salary-sacrifice cars, it is the employee's responsibility to maintain the vehicle and pay for repairs. The employer will pay for the car's insurance for the scheme's duration. The period usually runs for two to four years, and the employee must return the car at the end.



Is salary sacrifice worth it?

For employers, running a salary sacrifice car scheme is a good way to reduce environmental impact and boost workplace morale. Encouraging the use of low emissions vehicles has a lasting impact on the environment.



Employees can save up to 40% on a new electric car when joining a salary sacrifice scheme as the cost of the vehicle lease is taken from their gross salary pre-tax. With benefit-in-kind rates so low for EVs, a salary sacrifice scheme is a way to drive zero emissions, and will save you money compared with a petrol or diesel vehicle on the same scheme. This is because employees must ...