What is it?
Salary sacrifice is a financial solution offered by an employer to employees through a leasing company. With a salary sacrifice scheme, you can lease a car with no initial, upfront costs on monthly payments and no further obligations at the end of the leasing term. Many leasing companies offer turnkey solutions that can be implemented within 4-6 weeks, including comprehensive maintenance and business insurance plans.
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What are the benefits of a salary sacrifice scheme for an employee?
A salary sacrifice scheme allows employees to drive a fully electric company car, by forgoing a portion of their gross salary. The amount will be deducted before tax and National Insurance contributions are applied, akin to childcare, gym membership or cycle-to-work schemes.
What are the benefits of a salary sacrifice scheme for an employer?
A salary sacrifice scheme allows employers to offer employees a new car at a lower cost with a tax-efficient payment method. Additionally, the company may also benefit from reduced National Insurance contribution payments. Salary sacrifice schemes are HMRC and VAT compliant.
Who is eligible for salary sacrifice?
Eligibility for salary sacrifice is dependent on company policy. If an employer offers a salary sacrifice scheme, it’s available to employees with a permanent contract. Employees can learn more about eligibility from their employer.
How do I lease a Tesla through a salary sacrifice scheme?
Your employer’s leasing company provides an employee engagement portal, which is usually an online platform with step-by-step instructions. To learn more, reach out to your Human Resources Team or visit the HMRC website.