Employer Salary Sacrifice FAQs

We have tried to remove as much of the risk from the employer as possible. That’s why we offer early termination insurance to cover if an employee leaves whilst on the scheme and have partnered with Salary Sacrifice tax experts to support your HRMC reporting.  

Yes, the car could be reallocated to a different employee, but with early termination insurance included the car can be returned to the lease provider and you could lease a new car for your other employee.

Unfortunately not, we can only provide our salary sacrifice service to incorporated entities e.g. LTD or LLC businesses.

Provided the business is an incorporated entity, we can operate the scheme for one-person bands and large corporations.

Yes, which is why we’re pleased to now be able to offer this benefit to employers and employees alike. 

We’ve worked hard to streamline the process and take all the admin and legwork out of the process for businesses. We can usually get you set up in 24 hours, then it just depends on how quickly you can engage your staff. Once they are enrolled, we can place orders as soon as they'd like.

For each Salary Sacrifice Subscription, you'll have access to payroll instructions detailing employee salary deductions and BIK amounts from our Salary Sacrifice portal.

You can also access P46 (Car) forms to be submitted to HMRC at the start and end of each subscription, as well as the P11D form at the end of each tax year.

We're also on hand to answer any questions you have.

There are several rules that apply to a salary sacrifice scheme offered by any business in the UK:

• A salary sacrifice scheme is entirely at the discretion of the employee, and cannot be forced on an employee by their employer
• The scheme must not reduce an employee’s earnings to that which is below the national minimum wage
• To be eligible for a salary sacrifice scheme, the employee must be a permanent employee at the business
• The lease is between the employer and the lease funder, so the employee cannot make amends to the contract directly with the subscription funder
• The employer can’t withdraw the scheme from employees who are on long-term sick leave or maternity leave

With an electric car salary sacrifice scheme in the UK, there are several attractive tax benefits.

An employee is not taxed on the salary they sacrifice as part of the scheme. However, employees are liable for benefit in kind tax, which is is currently fixed at just 2% until April 2025. From April 2025, the BiK rate will increase by 1% every year until it hits 7% in 2028 With BIK as high as 37% for petrol or diesel cars, the benefits are huge.

Because part of an employee’s salary is given up, it also results in smaller National Insurance payments both from the employee’s and the employer’s point of view.

You can usually reclaim 50% of the VAT on the lease, and could set-up the scheme to transfer this saving to your employees.