What is Salary Sacrifice?
At first glance, the term salary sacrifice might not exude appeal. Dig deeper however, and you’ll find plenty to love. This mutually beneficial agreement between employee and employer allows the employee to drive a brand-new vehicle in one of the most affordable ways available on the market.
One of the best versions of salary sacrifice is for electric cars. Depending on the exact deal and model, salary sacrifice can be between 30-60% cheaper than other finance methods.
How Salary Sacrifice Works
In simple terms, an EV (electric vehicle) salary sacrifice scheme reduces your employee’s entitlement to cash pay in return for a non-cash benefit. Under our salary sacrifice scheme, the driver will receive an insured and maintained leased electric vehicle in return for a portion of their pay, equal to the cost of the lease and associated services.
By varying the terms and conditions of employment, the employee will receive a lower salary but on the plus side, will save on income tax and national insurance contributions. The resulting difference in take-home pay will be significantly less than the original amount of salary sacrificed.
Why Should You Offer Salary Sacrifice?
Salary sacrifice schemes offer considerable advantages to the employer, as well as employee benefits. A salary sacrifice scheme from Xcite offers the following business benefits:
- Attracting and Retaining Talent: A comprehensive benefits package that includes an EV salary sacrifice scheme demonstrates your commitment to providing additional perks and financial incentives beyond basic compensation.
- A Powerful HR Tool: As an ‘all employee benefit’ our salary sacrifice scheme significantly enhances your total benefits package and can be tailored to suit your corporate needs.
- Cost Savings: By implementing an EV salary sacrifice programme, employers can reduce their National Insurance contributions, lower their business mileage reimbursement and control salary costs. Savings can be reinvested into the business or used to enhance other employee benefits.
- Increased Employee Satisfaction: Offering attractive benefits through an electric car salary sacrifice scheme can improve overall employee satisfaction and morale. Employees feel valued when they have access to benefits that positively impact their finances.
- Improved Productivity and Loyalty: When employees feel their employer values their financial security and well-being, they tend to be more engaged, loyal, and motivated, encouraging a higher level of commitment to the company.
- Reduced Carbon Footprint: Encouraging employees towards lower emission vehicles improves your corporate social responsibility as well as compliance with health and safety and duty of care legislation.
Our Electric Vehicle Salary Sacrifice Scheme for Business Includes:
- Free business sign up and includes schemes with no upfront costs
- A fully electric vehicle leased on a term between two and four years
- Fully comprehensive insurance including business use
- Accident management support
- Full maintenance package including all servicing, tyres and MOTs
- Breakdown cover and early termination protection in case of unforeseen circumstances
- A dedicated account contact on hand to help when needed
How to Set Up a Salary Sacrifice Scheme
You can set up a salary sacrifice arrangement by changing the terms of the participating employee’s employment contract for a fixed period covering the length of the EV lease.
A salary sacrifice arrangement must not reduce an employee’s cash earnings below the National Minimum Wage (NMW) rate. You must put procedures in place to cap salary sacrifice deductions and ensure NMW rates are maintained.
Why Choose Xcite Salary Sacrifice?
Xcite is a leading provider of electric vehicle salary sacrifice deals, specialising in the administration and management of employee benefits.
Here's why you should partner with us:
- Wide Vehicle Selection: Xcite offers a diverse range of electric vehicle options from top manufacturers, allowing your employees to choose from a wide selection of models ranging from compact city cars to spacious SUVs.
- Competitive Pricing: We provide competitive pricing for our salary sacrifice schemes, meaning your employees can enjoy the benefits of a brand-new electric vehicle at an affordable cost.
- Expertise and Experience: With years of experience in the industry, we have a deep understanding of delivering salary sacrifice programmes. Our team of experts will guide you through the process, ensuring smooth and efficient implementation.
- Tailored Solutions: We recognise that every business is unique and take a personalised approach to developing salary sacrifice schemes that align with your business goals. Our solutions are flexible and scalable to maximise benefits for both you and your employees.
- Compliance and Administration: Navigating the complexities of salary sacrifice can be challenging. Xcite takes care of all the administrative tasks, ensuring compliance with relevant regulations and laws. Us handling the paperwork, calculations, and reporting, means you can turn your focus to core business operations.
- Ongoing Support: Our commitment to your success doesn't end with implementation. We provide continuous support and assistance on vehicle fleet management, employee communications, and guidance on updates and changes to legislation that may affect your salary sacrifice scheme.
For the answers to more detailed questions you may have, such as what happens in the event of a driver accident and what is covered by insurance, visit our FAQs page or contact the team.
