Salary Sacrifice Leasing for Electric Cars

[Paul Lazzaro]

Our firm are looking at cost/tax efficient ways to get cars for personal use. Those who would be offered the opportunity are all directors, so we can pick whatever approach/scheme works best.

I think, from limited research, that's likely to be a salary sacrifice scheme for electric cars. We are all well into the 40% tax bracket. The business owners have indicated that it's going to be an additional perk, so they'd effectively look to increase our salaries to an amount necessary to cover whatever the salary sacrifice and BIK cost would be to us.

I've looked at a few providers, but clearly their advice/blurb is going to be biased and selective. So, can anyone offer any decent insight?

I'm sure it won't be as simple as looking on Leaseloco at personal lease deals and then taking 40% off the advertised price? The few providers I've looked at don't seem to offer many cars and their gross prices don't exactly look competitive compared to what's available on the personal lease market.

I also understand it'll impact our pension contributions - presumably that's the company's contribution and we'd then need to adjust our own % contribution to keep the same £ value put away each month.

Any other things we should consider?

Edit - Also, any suggested providers/websites where we can see what would be available at relevant budgets would be appreciated.

Edited by Paul Lazzaro on Wednesday 24th May 17:53

[Paul Lazzaro]

But what if your employer was offering to you as a perk by increasing your salary to cover your cost of leasing. So let's say they decide they think you're worth a decent spec 5 series (new electric, of course). What's the most tax efficient and cost efficient way of achieving that? Either increase salary and offer a salary sacrifice lease scheme, just do a normal company car scheme or something else?

[Paul Lazzaro]

J1990 said:

If they're wanting to give it to you, why don't they just give it as a company car and ignore the whole salary sacrifice option? The recipients then only have to pay BIK. If this isn't focused on the employer reducing their pension and NI contributions then it seems rather convoluted to go down the salary sacrifice scheme.

That'd certainly work better for those receiving the cars and would be my preference. But I'd like to find the most cost effective way for the company owners too.