Join the rEVolution!

Salary Exchange (also known as Salary Sacrifice) is a feature of many employment packages in the UK.  Many employers use it for things like employer pension contributions, cycle to work and childcare vouchers. In effect an employee gives up their contractual right to pay in return for an employer provided benefit, saving tax and national insurance in the process.

One of the most exciting and growing areas in employee benefits currently is salary sacrifice into an electric company car. Since 2017 we’ve seen the tax efficiencies of many benefits removed under salary sacrifice, but cars that emit 75g/km or less of CO2 (broadly Plug-in Hybrids and fully electric cars) still generate significant tax and NIC savings for both employees and employers.

On a typical EV car, under salary sacrifice, a typical employee can save approaching 50% of the cost of owning and operating the car, and an employer can save £1,000 to £2,000 a year in employer’s NIC.

In theory these schemes are easy to set up and operate, but there are many traps for the unwary. Combining our Employment Law expertise with our Employment Tax experts, we can help you set up a scheme that saves both the employee, the employer AND the environment, in a way that is both free of risk and additional admin.

Do please get in touch with us if you’d like to join the rEVolution!