However, that means youll want to know how much that commission is. You wont know if your company is eligible until you apply. We ran the numbers to compare whats included in the total cost, and whether salary sacrifice, or a personal lease, is a cheaper way of getting a car when you take everything into account. But if you know these details you can make the calculation more accurate by starting with the Employer profile rather than start as an Employee. Were comparing a petrol version of the Corsa with an electric one of a higher spec, because most drivers will expect the EV to be more expensive. This means your net pay will go down by the amount you pay for the car, minus your tax savings. When you lease a car youll put down an upfront deposit, make monthly payments and then either return the car to the leasing company at the end of the contract, or you might have the option to buy the car at the end of the lease. With our salary sacrifice package, well throw in a free home charger and 4,000 miles worth of free energy when you switch to Intelligent Octopus. Car leasing is the same as a long term rental. The numbers are based on a 40-year-old driver who earns 40,000, lives in South London and drives 8,000 miles a year. For example, for a 40 per cent tax rate payer opting for a Tesla Model 3, the typical net cost for an employee is . A guide to the different types of electric vehicles. The calculation for the . Pay in 10,000 for bonus. Because our electric car salary sacrifice is one all-inclusive price that covers everything you need to hit the road, this comparison gives drivers savings of nearly 70 per month while letting them switch to a brand new, top-spec electric car. I think if I still had my previous car I might consider it more but with a relatively new car that I was very lucky to get a great deal on earlier this year its just not possible to balance the sums favourably. Their monthly lease prices may be higher because they are middle-men to middle-men, serving as an appointed representative of a broker. Click on the appropriate button below to get your Car Salary Sacrifice calculation started: Create an employer profile for taxes and pension contributions. . Lease prices are higher because they are a leasing company that is considerably smaller than the market leaders and they have a higher cost of capital. If youre taking out a lease on a petrol or diesel car, youll be paying much more in fuel costs than you would if you were leasing an electric car. included with our EV salary sacrifice scheme? You just need your employer to sign up first.Fill in your company details so we can get in touch - it wont cost them a penny but it might earn you a few brownie points. Their early termination policy covers dismissal. Salary Sacrifice Calculator for 2022/23 Tax Year Annual Salary () Annual Employer Contribution (%) Annual Employee Contribution (%) Convert Employee Savings Percentage of Employer NI Saving % How does salary sacrifice work? The above example relies on the motorist driving 8,000 miles a year for four years and also makes the assumption that the company is eligible to recover VAT - 50 per cent on Finance and 100 per cent on Services. Most importantly, you want to ensure the company knows what theyre talking about and can offer guidance. Personal lease: Monthly cost of tyres for Corsa 1.2 SE Edition = 10.83Through our salary sacrifice scheme, well cover punctures and sidewall damage. According to Auto Express, 10% of cars that fail their MOT need new tyres. Our salary sacrifice monthly payments include absolutely everything you need to hit the road: car, charger, insurance, servicing, maintenance, breakdown and tyres. That means we can set you up with the scheme from start to finish. Same here, and zero credit check etc. This is because these factors impact on how much you might be recharged by your employer in a Car Salary Sacrifice plan. BCH and selected Salary Sacrifice deals. On average UK drivers can expect to pay around 484 per year, according to Nimble Fins. Check out the video below to find out more. Love Electric Financial Services Limited is a credit broker and not a lender. Is commercial property a great value investing opportunity? Anyway, if anyone interested in asking their employer to sign up to the scheme and has a car in mind I don't mind having a quick look for you to see a rough guide price. We've split our Car Salary Sacrifice calculator between employers and employees. Alternatively, this can be a cost-effective way for an employer to start a pension scheme, if they are setting out on this road. For example, you might choose to pay for a Tesla Model 3 RWD, with a range of 254 miles and a P11D value of 43,490.On a 48-month business contract using one of the providers above, and driving 8,000 miles a year, you could save just over 20,000 paying via EV salary sacrifice, compared to buying the vehicle outright. If you don't have off-street parking or a driveway, we'll give you 4,000 miles of free public charging credit with Electroverse. It may not display this or other websites correctly. According to the Nimble Fins research, the average petrol car driver in the UK spends around 1,272 a year on fuel to get from A to B, at a cost of around 20.1p per mile. included in the lease price. The overall process is meant to be cost neutral for businesses as they can recover VAT and also save as they make lower National Insurance contributions due to the salary sacrifice - bothare used to calculate the employer's gross sacrifice. Again, if you don't have all the car details then just accept the suggested finance and maintenance values that appear in our Car Salary Sacrifice calculator and use your own insurance premium as a starter. The cost of the MOT isnt a problem for most drivers, but the cost of repairs that the MOT uncovers can be hefty. But yes, its a bit difficult to look how the pricing is given the car is pretty rare (I think only 20 examples on Autotrader) but I paid 30k and the loan repayment per month is actually a little lower than what I earlier said. Money that youd usually never see because it goes straight out of your pay to HMRC will now go directly to paying for your car. loveelectric was founded when our CEO, Steve, wanted an electric car and realised that purchasing one was out of budget. When researching various electric vehicle salary sacrifice benefits, understanding which scheme might be the right fit for you and your company can often be challenging. If the employee resigns in under 3 months (and doesnt transfer the contract or take it with them to a new employer) early termination protection cannot be applied and the employee would be liable for up to 50% of the rest of the lease. Who is WeVee good for? But much depends on what you do next. Octopus is best known as an electricity and gas provider, but in 2018 they branched out to electric vehicles and the salary sacrifice scheme.. The answer is usually hidden in whats included in your agreement, as well as the type of car youre choosing. Employers and employees who want everything bundled together and include a charging solution and home energy tarriff. It's also 100% anonymous, in case you were wondering. For this reason, you want to ensure the team communicates clearly and quickly. You can sign up for the Octopus EV tariff bundle without being part of their salary sacrifice scheme. For the Tesla. Without Salary Sacrifice 663.00 per month* With Salary Sacrifice 445.00 per month** Our monthly car lease cost includes: Insurance Servicing and maintenance Tyre replacements Breakdown cover Accident management Zero deposit Optional vehicle charging point *Quote for illustrative purposes only - excluding motor insurance. 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Also bear in mind the wait for the Tesla MAY be long, may be quick. Published: 07:45 GMT, 8 April 2021 | Updated: 07:45 GMT, 8 April 2021. But really, it's not. It provides everything businesses and employees need to go electric in one place including EVs, home and workplace chargers, smart energy tariffs to keep bills low, and impartial expert advice on going electric. The firm said it is introducing the programme in response to a surge in interest in electric vehicles from businesses. The calculation uses the most common tax-code of "1257L". Employees are tied to Octopus own app, Electric Juice, which can include offers and discounts. You also want to ensure employees have an outstanding customer experience when ordering a car. Get 4,000 miles of Electroverse credit to use across the UK's charging network. 'Salary sacrifice is essentially a zero-cost, zero-effort tool for businesses to fight climate change and save the planet. Option to buy the car at the end of the agreement (however you wont get a settlement figure in advance). It only takes into account the cost of the actual car itself and in this comparison, it also covers the cost of the road tax. Full electric cars are exempt from Vehicle Excise Dutybut drivers still have to pay Benefit-in-Kind tax if you are going to run one as a company car. 2. Registered office and trading address: 101 Rose Street South Lane, Edinburgh, EH2 3JG. Youll need to replace all four tyres every 2 years on average. Weve used Nimble Fins averages and our own research based on like-for-like services to crunch the numbers for this comparison. Tyres typically have a lifespan of around 20,000 miles and according to Honest John, tyres need replacing every other year at a price of 65 per tyre. Salary sacrifice: Monthly cost of insurance for Corsa-e SE Premium = 0. Octopus has been providing salary sacrifice for the last year but only as a broker for other leasing companies. We hope this comparison is practical and will help you navigate the field of electric car vehicle salary sacrifice schemes. As you can see, our electric car salary sacrifice scheme really does cover everything you need to hit the road. This has been updated for the current tax year of 2022/23. Use our EV salary sacrifice calculator below to find out how much you could save each month. Salary sacrifice: Monthly cost of MOT, maintenance, servicing and repairs for Corsa-e SE Premium = 0. Inside Octopus EV podcast . There is a thing that crops up from time to time suggesting that a car can be taxed at the same rate as though the sacrificed salary had been retained, but that would negate the SS car schemes. Our dedicated team are on hand to support whenever you need it. Retain the same pension contribution, so your take-home pay goes up, Add the savings to your pension pot so it grows for your retirement. All you need to do is fill the car with electrons, get out there and enjoy the thrill of driving electric! Will employees get their questions answered quickly. Keep in mind that this amount cannot be salary sacrificed so the fee will the gross amount before taxes. Call or email us during normal office hours to talk about the specifics of your arrangements. This site uses cookies to allow good user experience. Salary. is a credit broker and a vehicle hirer but not a consumer credit lender. Early termination only covers 10% of claims or ten cars whichever is greatest. By comparison, combustion vehicles are subject to a typical BIK tax of 25 to 35 per cent. Salary sacrifice: Monthly cost of fuel for Corsa-e SE Premium = 10.50. Octopus Electric Vehicles Limited is authorised and regulated by the Financial Conduct Here are some features of other salary sacrifice schemes: Tusker has provided salary sacrifice schemes to companies for over ten years and offers everything from fleet management to brand new electric cars and company cars. Car Model Annual Salary () Calculate How it works Simply select the electric car you're interested in and enter your annual salary. Volvo assume 400 insurance, 150 tax, 300 tyres, 300 servicing. According to Nimble Fins, the average cost of running a petrol or diesel car in 2022 is 3,000 a year. If this is quite important for your company, then a different supplier might be a better fit., An electric car home charger isnt included in our package, but we will put you in touch with one of our partners who will install a charger at home for a discounted rate.. Youll drive the car over a set period, and return it to the leasing company at the end of the agreement. Here are some reasons why:, The main thing to keep in mind when comparing electric car salary sacrifice schemes is that youre often comparing apples to oranges., Many schemes will include different services and have different eligibility criteria and policies, which can make it harder to compare them directly., What you really need to look for is quality of service and product and weigh that up with the monthly service cost. New to Salary Sacrifice? No need to find a quote or keep on top of annual payments, its all taken care of. Tusker monthly lease prices may be higher because they are a leasing company and offer lifestyle protection. Feb 16, 2023. Also, there is a slight bump to take care of loan car and also the fact that resignation (and some other things) do allow you to give the car back at no penalty (so they have to get that back somewhere). Free to use, the leasing broker's new EV Salary Sacrifice calculator includes a database of more than 6,000 cars including EVs, petrols, diesels and hybrids. They all offer electric cars which will result in a lower Benefit in Kind (BiK) tax and no road tax. This is Money is part of the Daily Mail, Mail on Sunday & Metro media group. All in one easy monthly payment. We don't as a general policy investigate the solvency of companies mentioned (how likely they are to go bust), but there is a risk any company can struggle and it's rarely made public until it's too late (see the. But once you get set up, almost all the monthly leases will be more expensive and are likely to be a lot higher than a personal lease., Different suppliers have different revenue models. The cost of the MOT isn't a problem for most drivers, but the cost of repairs that the MOT uncovers can be hefty. When taking out a personal lease, youre paying for your car from your income or savings after youve already paid tax. No standing. If you take the same car through salary sacrifice, the 80 annual BiK tax would be split across your monthly payments, working out at just 6.67 per month. The cost of a personal lease is cheaper at face value than a salary sacrifice car, but thats because it doesnt take into account all of the extra running costs that need to be factored in. We often link to other websites, but we can't be responsible for their content. Love Electric Financial Services Limited is authorised and regulated by the Financial Conduct Authority; firm reference number 743264. below). 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