Octopus Electric Vehicles reserves the right to stop this promotion at any time. The launch of Electric Dreams comes exactly one year on from the UK Government's move to eliminate BIK tax for employees taking an EV via salary sacrifice. *The P11D value that HMRC uses is basically the list price minus the government EV grant, more This allows you to do one of two things: There is a NI saving for your employer. Best salary sacrifice car scheme comparison table, What to look out for when choosing an EV salary sacrifice scheme, Electric Cars are Expensive. No off-street parking? At all times, if an employee resigns they can transfer the lease to another employee or take the lease with them to their new employer (if eligible) at no extra cost. Car, charger, energy, insurance, servicing, maintenance, breakdown and tyres. Octopus said many drivers are saving 30 to 40 per cent and some up to 60 per cent. The cost of the MOT isnt a problem for most drivers, but the cost of repairs that the MOT uncovers can be hefty. The Employer Car Salary Sacrifice calculator estimates all of the items in the Employee calculator plus: employer's national insurance contributions employer's pension scheme contributions VAT recovery and business tax relief the employer's total cost of Car Salary Sacrifice before and after tax relief/recovered VAT 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. Salary Sacrifice 0. The No. The P11D value is the list price of your car including VAT, combined with any delivery charges, but doesnt include the cars first registration fee or annual road tax. 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. Salary sacrifice: Monthly cost of fuel for Corsa-e SE Premium = 10.50. They allow employers to set up an entire car fleet. Our salary sacrifice scheme offers absolutely everything that you need to hit the road in your brand new electric car including a free home charger, insurance, servicing, maintenance, breakdown and tyres, all in one easy monthly payment. So their fee comes out of charging double rent for the first 6 months, as well as an additional fee to the employer.. However, for the 2020 to 2021 financial year, the BiK rate for zero-emissions company cars was just 0 per cent meaning there was nothing to pay until this month, at which point it goes up to just one per cent. Refer your clients to give them access to our electric car salary sacrifice scheme. All in one easy monthly payment. Salary sacrifice: Monthly cost of salary sacrifice for Corsa-e SE Premium = 330.08 Maintenance, Servicing and Repairs An MOT is a legal requirement that costs around 55 per year. Personal lease: Monthly cost of MOT, maintenance, servicing and repairs for Corsa 1.2 SE Edition = 22.50. Salary sacrifice: Monthly cost of tyres for Corsa-e SE Premium = 0. Are investors underestimating the impact of rate rises? The salary sacrifice tax savings are particularly attractive for me. Varies. Will employees get their questions answered quickly. * Please note that these can be expressed as a cash amount or percentage of your salary, Annual Employer Contribution (%) all staff, senior team only. Tesla is still one of the most popular electric vehicle leased through Octopus EV but its share dropped from 50 per cent to 28 per cent from the first three months of 2020 compared to the same time frame this year. These benefits are non-cash. Tusker primarily works with companies with 1,000+ employees. The lot. Any prices quoted are subject to changes in law, regulation, tax or duty beyond our reasonable control. You can calculate your take home pay based of your annual income, PAYE, NI and tax for 2023/24. Yes, you give up part of your gross income to pay for the car. Launch 1. 1 min read. VAT registration number 386404284. 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. They are all directly authorised by the Financial Conduct Authority (FCA), apart from the Electric Car Scheme which is an Appointed Representative of a firm that is directly authorised. Any prices quoted are subject to changes in law, regulation, tax or duty beyond our reasonable control. Salary sacrifice: Monthly cost of MOT, maintenance, servicing and repairs for Corsa-e SE Premium = 0. With our salary sacrifice scheme, fully comprehensive insurance is normally included in your monthly payment. 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). To get started with our Car Salary Sacrifice calculator here's what you will need for each version . Don't worry if you haven't got all this yet - you can still estimate the cost impact using values our Car Salary Sacrifice calculator will provide automatically. You already have all the answers you need." Your initial deposit can be between 1 - 12 months of the monthly lease cost, so youre parting with anywhere from a few hundred to a few thousand pounds at the start of the process. Making Tax Calculations Simple. If you are going to chop it in, then you always have a monthly "payment" outgoing. 'With incredibly low company car tax rates on EVs, demand has never been higher almost a third of employees want the option of an EV as a company car and our own enquiries from businesses have risen seven-fold in the last year alone. 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. Each salary sacrifice calculator allows you to enter salary sacrifice as a fixed amount of a percentage of your Gross pay. I think it sounds a great scheme but for me it simply would not be cost effective. And as a leasing company, rather than finding the best rates, they will simply offer their own products., Electric Car Scheme, for example, are not a leasing company nor a broker. 1. Well-maintained tyres keep you safe on the road and make your travel more fuel-efficient, but if theyre not well looked after they can result in your car failing its MOT. Are their answers a little wishy-washy and not specific? KIA, Polestar, Mercedes, VW and Porsche also all have a share. 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. Some 15 companies are already live on the scheme, including Huel and Purplebricks, making it available to 1,491 employees across the UK. Volvo assume 400 insurance, 150 tax, 300 tyres, 300 servicing. It is often a pension contribution. This works when an employer and employee come to an agreement over salary. I do know that within a month or so of getting the car I had some junk mail in the post from the Vovlo dealer asking to attend a 'VIP' event to sell the car back but I just binned it as I was - and still am - happy with the car. Technically you are still paid the same. None require an upfront deposit from an employer or employee. Editor, Marcus Herbert, https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim23035. So far, 141 companies have signed up to salary sacrifice with Octopus, making it available to 22,298 employees. Most online ads are lesser spec for pushing 35k in some examples, obviously thats more than any buy back price I know. Inside Octopus EV podcast . Companies that are interested in business car leasing as well as salary sacrifice. You can calculate results based on either a fixed cash value or a certain proportion of your salary. If It also assumes the employer wishes to reflect any net savings they made in National Insurance by reducing the gross sacrifice so an adjustment of 10 per cent has been made. is a credit broker and a vehicle hirer but not a consumer credit lender. An electric car salary sacrifice scheme is a way for your employees to get an EV as an employee benefit and save on tax. Or if we enter a period of financial difficulty and need to make some employees redundant? Since they do not own the relationship with the leasing company, they wont have full responsibility over their regulatory conduct, systems and processes. Option to buy the car at the end of the agreement. Most importantly, you want to ensure the company knows what theyre talking about and can offer guidance. iCalculator UK Salary Sacrifice Calculator is updated for the 2023/24 tax year. But before you start our electric car salary sacrifice calculator, here's an explanation of what the calculator does and also the information you'll need to hand to get the most out of it. For example, for a 40 per cent tax rate payer opting for a Tesla Model 3, the typical net cost for an employee is 435 every month with the gross sacrifice from salary coming in at 726 per month. I think for the lease to become worthwhile in purely cash terms over four years the Volvo would need to be worth only about 30% of its original value in 2026, have had a huge amount spent on maintenance, or diesel shooting up to seriously astronomical levels per litre, none of which I think is realistic. According to Nimble Fins, the average cost of running a petrol or diesel car in 2022 is 3,000 a year. Make. Employers will first rent an electric car from a supplier with the employee then given the option to rent this car in exchange for a part of their salary. It simply means their rental prices cannot match the ones of large leasing companies. Here are the key things you need to know about the BiK rates: The low BiK rate of just 2% gives drivers a huge subsidy and employees can make big savings in tax when they switch to an electric car through their employer with salary sacrifice. Whos Tusker good for? You to a panel of third-party lenders or hirers and in such circumstances may receive a Yeah, seems so. Authority, firm reference number 809736, company number 10754317. You can keep hold of your cash and pay for your car out of your monthly salary at one standard cost across the period. So, if, in 3 years, you pay it off, keep it, it's going to running it as the only outgoing and, a depreciating asset. Change the numbers to suit you. Filter. 7,998.40 - is the effective 'additional' salary that I'm to be taxed on (Total cost of vehicle X BiK rate) 7,620.00 - is the salary im sacrificing (company has to pay 635 a month for the vehicle so 635 X 12) 40,000.00 - My current taxable salary 32,380.00 - My taxable salary after we remove the sacrificed salary Find out how. included in the lease price. (adsbygoogle = window.adsbygoogle || []).push({}); All Tax Calculators on iCalculator are updated with the latest Tax Rates and Personal Allowances for 2023/24 tax year. Octopus Electric Vehicles - electric vehicle leasing for personal, business and salary sacrifice including charging and cheap renewable electricity. Also bear in mind the wait for the Tesla MAY be long, may be quick. 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. For the Tesla. Read this guide to Salary Sacrifice and How Salary Sacrifice can reduce the amount of tax you pay. WeVee is a car leasing company that offers electric cars via corporate leasing, car sharing as well as the salary sacrifice scheme.. 'We are thrilled to see so many customers offering our service to their employees already and the signs are that many more will sign-up in 2021.'. Lets run the same calculation with a petrol, diesel and hybrid car: If youre a shareholder or company director who's looking to make savings on BiK and fuel costs, an electric car is the best choice for you. We often link to other websites, but we can't be responsible for their content. Powered by Xenforo, Hosted by Nimbus Hosting, Original design Critical Media Ltd. Offer corporate leasing, corporate pool cars and car sharing. The BiK rates range from 2% for zero and low emissions vehicles, all the way up to 37% for cars that create more pollution, The BiK rate for electric cars has increased from 1% to 2% from 6th April 2022, and is currently fixed until April 2025, From April 2025, the BiK rate will increase by 1% every year until 2028, Your income tax bracket (e.g. New to Salary Sacrifice? There are already many similar cycle to work schemes in place where workplaces provide their employees with bikes to get to and from their office. I've always bought nearly new cars and run them a long time (as is the FIRE way, Skoda Octavia FTW! Heres How Were Democratising Electric Vehicle Access At Loveelectric.. 3. HMRC treats the benefit separately from your salary, which means you pay the tax before it arrives into your bank account. To calculate your BiK rate you need three numbers: P11D value of the car x BiK tax band x your income tax bracket. Not much post-care or educational content for employees. All allow you to customise your car: from the colour and trim to the interior and additional features, you can personalise your brand new car to your requirements. Below is a chart summarising some of the leading electric car schemes in the UK.. Youll drive the car over a set period, and return it to the leasing company at the end of the agreement. Don't forget, as with any investment, that it can fall as well as rise. If you don't have all the details then allow about 5 minutes to work through the stages of the calculator. Sorry Scotland. BiK has historically been very low for electric cars to encourage the uptake of low emissions vehicles as the UK moves towards decarbonising transport. Car leasing is the same as a long term rental. 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. Copyright 2021 loveelectric. A further 20 more models will be available later in 2021. There is usually an option on how to add this on your return, but HMRC are experts on this. 50,271 to 100,000. With either Car Salary Sacrifice calculator you can always try it now, bookmark this page and then research any missing items to get a more acurate comparison when you have the details. Keep in mind that this amount cannot be salary sacrificed so the fee will the gross amount before taxes. When we take into account the costs of fuel, insurance, tyres, MOT, servicing and repairs on top of the basic lease price for a personal lease, we can see that getting hold of an electric car equivalent through salary sacrifice works out cheaper. This is Money is part of the Daily Mail, Mail on Sunday & Metro media group. Drivers of hybrid cars can pay BiK rates of up to 10 times more than an electric car would pay. Some employers choose not to include insurance, but its up to your company. Weve used Nimble Fins averages and our own research based on like-for-like services to crunch the numbers for this comparison. By comparison, combustion vehicles are subject to a typical BIK tax of 25 to 35 per cent. The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline. is a credit broker and a vehicle hirer but not a consumer credit lender. loveelectric was founded when our CEO, Steve, wanted an electric car and realised that purchasing one was out of budget. The actual amount will depend on which costs the employer wishes to take in to account. Once you've inputted your company details we'll give you a call to get you set up. If the employee resigns after 3 months into the lease (and doesnt transfer the contract or take it with them to a new employer) they will only have to pay a one-off fee worth one month of the gross lease payment.. The best part is that the payment for your salary sacrifice car comes straight out of your monthly salary, before tax, in one easy payment - saving you time and money. is a credit broker and a vehicle hirer but not a consumer credit lender. Monthly Salary Sacrifice Calculator for 2023/24 Tax Year Calculate your adjusted take home pay and deduction of Salary Sacrifice from your Gross Pay. Octopus may introduce 'If just 10 per cent of UK's employees switched to electric we could decimate CO2 emissions of cars, while collectively saving almost 4billion per year. Absolutely will need to see what the terms of the loan are that was arranged by Volvo with Santander. British Vehicle Rental & Leasing Association (BVRLA) member number: 10549. 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