loveelectric is also a B Corp (pending). 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. Electric car scheme customers will have to pay double rent for the first six or 12 months. For other cars no. Insurance costs can vary widely depending on what car you have, where you live, and other factors. 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. For this reason, you want to ensure the team communicates clearly and quickly. Even with the increase in BiK at 2% for electric cars; the tax is much lower than for hybrids, petrol and diesel cars. Lets take a comparison of the cost of leasing a Corsa 1.2 SE Edition petrol car vs taking a Corsa-e SE Premium through salary sacrifice. When you lease a new car, youll usually make an initial payment at the start of the contract. Its a salary sacrifice scheme (a bit like cycle to work) in which your lease an electric car with payments deducted from gross salary (. Do note, while we always aim to give you accurate product info at the point of publication, unfortunately price and terms of products and deals can always be changed by the provider afterwards, so double check first. Not sure that Octopus/Tasker are routinely hiking the price mind. 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. Octopus said many drivers are saving 30 to 40 per cent and some up to 60 per cent. I think it sounds a great scheme but for me it simply would not be cost effective. Start by creating a personal profile with salary and tax details. Examples include the VW ID3 Pro at Now press "Calculate" to get the results. Huel and Purplebricks are two large firms who have already signed-up, with more than a hundred new enquiries every week according to Octopus, which had Prime Minister Boris Johnson visit its London headquarters late last year. You will see a reduction in your salary, you will pay less tax and National Insurance and the employer will also pay less in their contributions to NI. It will rise to 2 per cent over the next three years. The No. VAT registration number 386404284. 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.. 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 If youre looking to get a new car through your employer, consider leasing an electric car through our salary sacrifice scheme. 1 Home Entertainment Tech Resource. Electric vehicles are also increasing in popularity with March the best single month for sales of new zero-emission electric cars on record, beating last December by less than 100 sales, according to figures fromthe Society of Motor Manufacturers and Traders (SMMT). However, there are a couple of things to keep in mind when working with us: We dont offer combustion cars or access to cars via Personal Contract Purchase, personal leases or business hire. Any driver who uses a company car for personal use pays BiK tax out of their monthly wage. Is commercial property a great value investing opportunity? '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.'. Drivers of hybrid cars can pay BiK rates of up to 10 times more than an electric car would pay. Published: 07:45 GMT, 8 April 2021 | Updated: 07:45 GMT, 8 April 2021. . This does not affect our editorial independence. If you already have an electric car through your employer youll continue to enjoy super low BiK rates - saving money, and the planet, at the same time. These contributions are taken from your salary before tax and National Insurance are paid, so are tax efficient. a couple of hundred pounds a month more expensive than a regular lease. There is less of a focus on post-care and helping employees get set up with cars (based on. Octopus may introduce 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. For me to be greener in the short term I'd prefer to make sure my home is better insulated, use 100% renewable energy etc. Ready to find out whats so special about our EV salary sacrifice scheme? If you need more convincing check out our handy guide on why you should choose electric for your next car.Getting a car through your employer with our salary sacrifice scheme can save you up to 40% off the price of a brand new EV through Income Tax and National Insurance savings. Salary sacrifice: Corsa-e SE Premium initial payment = 0. 33,600.the Jaguar i-Pace EV400 at 65,195 or the Nissan Leaf Acenta at 30,445. This provides savings of 290 per month, inclusive of income tax and national insurance with just 14 in BiK tax and equates to savings of 13,920 over a four year period. Our salary sacrifice scheme is the perfect choice if you want to make savings on switching to electric through your salary, and ditch the hassle of car ownership. Below is a chart summarising some of the leading electric car schemes in the UK.. If they are self-insuring for specific claims, could that be a risk if they are hit with too many claims? For example, if their gross monthly lease is set at 500 per month for a 24-month term and they resign at month four, the termination fee would be 500. The sacrifice the employee makes out of gross salary is 726 which, after tax, is equivalent to paying 435. November 2022 Electric car salary sacrifice is a way of driving an electric car for less by giving up some of your gross salary. Wales. Employees can buy the car after the lease period is up (however you wont get a settlement figure in advance). Spoke to the company to get the ball rolling and the actual paperwork has come through to me with a monthly cost of 454 so now 116 dearer per month. 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. None require an upfront deposit from an employer or employee. Offer corporate leasing, corporate pool cars and car sharing. You are tied in to their full bundle, which may be right for some employees, but almost certainly will not be right for all employees. Any prices quoted are subject to changes in law, regulation, tax or duty beyond our reasonable control. Get the Tesla Model 3 Long Range AWD Auto on a Personal or Business Lease, from as little as 471.99, and with FREE UK delivery. Electric Car Scheme was started in 2021 with business contract hire leases, and launched a salary sacrifice scheme in January 2022.. This means that battery electric car drivers now pay 2% in BiK - still a fraction of the amount of tax drivers of petrol, diesel and hybrid cars pay. It may not display this or other websites correctly. The scheme, called Electric Dreams, uses a system known as 'salary sacrifice' which allows staff to pay for a new electric vehicle out of their gross salary, potentially saving them thousands of pounds on national insurance and income tax. Ideally, they should have a document that clarifies the responsibilities of each party, so you are not liable for employee errors. Personal lease: Monthly cost of breakdown cover for Corsa 1.2 SE Edition = 14.08With our salary sacrifice package, breakdown is included at no extra cost, so you dont need to worry about getting your own roadside assistance. Salary sacrifice: Monthly cost of fuel for Corsa-e SE Premium = 10.50. If And at loveelectric, we provide one of the best policies on the market. Sorry Scotland. They offer cars via contract hire and salary sacrifice. I've always bought nearly new cars and run them a long time (as is the FIRE way, Skoda Octavia FTW! This is the really fun part. At loveelectric, we simply charge a small commission against the P11D value of the car (youll never pay more than 1.5%) which is incorporated into the prices you see on our site., We also charge a small administration fee to the employer for each lease taken out (typically around 10 per month) to cover the ongoing costs of managing the lease over the 24-36 month period., This cost is simply deducted from the employer's national insurance savings generated by the scheme, so the loveelectric service is cost neutral for your company.. So far, 141 companies have signed up to salary sacrifice with Octopus, making it available to 22,298 employees. Ideally, they arent spending hours trying to order a car, and the experience is relatively intuitive. We've pre-filled some sample data. Then just click the "Calculate" button to see the savings. Inside Octopus EV podcast . 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. 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. Whos Electric Car Scheme good for? Tusker primarily works with companies with 1,000+ employees. Our electric car salary sacrifice scheme is free for employers to join and can be set up within just a couple of weeks. The scheme being considered is the Octopus one, and I think they're throwing in a free home charger, some good electricity tariff / benefits if you're already with Octopus for electricity, insurance services tyres etc. Are their answers a little wishy-washy and not specific? Employees can access both combustion and electric cars. Octopus Use our EV salary sacrifice calculator below to find out how much you could save each month. Octopus Electric Vehicles Limited is authorised and regulated by the Financial Conduct And we include everything that they need to hit the road in their shiny new electric car. British Vehicle Rental & Leasing Association (BVRLA) member number: 10549. Insurance is an essential part of keeping your car on the road. But much depends on what you do next. Bear in mind your saving is, this: Assume 500pcm for the Tesla (NET) Fuel cost PA Volvo about 1500 (61mpg on 15k, though probably more) Fuel Cost Tesla (assume 10p rate) at 3.8KWH/mile about 400 PA. Then car tax, insurance, servicing etc. Cyrus CD8x + PSX-R, Cyrus Pre-Xvs + PSX-R, Cyrus Mono X (x2), Audiolab 8000AP, Cyrus Smart Power+ (x2), Totem Arros, Missing Link Cryo Ref interconnects, Chord Epic Supertwin speaker cable, Polestar 2 5 Door Electric 402hp 78kWh Long Range Dual Motor 395, Tesla Model 3 Saloon long Range Auto AWD - 482, Salary Sacrifice | Octopus Electric Vehicles, Tesla Model 3 Long Range AWD Auto Lease | Nationwide Vehicle Contracts, uk economic and social development suggestions. Employees will pay a fixed monthly cost for the vehicle whichis made using their gross salary which is their income before tax or net salary plus their national insurance and income tax. Sort by. Alternatively, this can be a cost-effective way for an employer to start a pension scheme, if they are setting out on this road. Check out this guide that explains why companies choose our salary sacrifice scheme. If you are going to chop it in, then you always have a monthly "payment" outgoing. There aren't any downsides compared to a standalone lease. One of the reasons Octopus has decided to start the scheme now is thanks to the low company car tax rates on EVs which can make them a hugely beneficial option for those looking to help the environment. Read this guide to Salary Sacrifice and How Salary Sacrifice can reduce the amount of tax you pay. The calculation for the . 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 Octopus EV good for? Octopus Electric Vehicles reserves the right to stop this promotion at any time. The move instantly made an EV financially much better than a petrol or diesel equivalent, leaving drivers with savings on income tax and national insurance. What will the onboarding experience be like for the employee? When taking out a personal lease, youre paying for your car from your income or savings after youve already paid tax. Option to buy the car at the end of the agreement (however you wont get a settlement figure in advance). 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. or less. No need to find a quote or keep on top of annual payments, its all taken care of. 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. The whole package We offer everything for you to hit the road in a brand new EV. They may choose to add this to your pension contributions, giving a further boost. Octopus Electric Vehicles Limited is authorised and regulated by the Financial Conduct Companies that are interested in business car leasing as well as salary sacrifice. That's the group's vision and the website goes on to explain more about that goal. Drivers that order an EV through Electric Dreams before July 2021 also receive a free smart charger fully installed by the Octopus Energy Services team. It is often a pension contribution. commission. Then it might be a sign that they dont have high standards or simply dont fully understand the complexity of an EV salary sacrifice scheme. is a credit broker and a vehicle hirer but not a consumer credit lender. Its a financial commitment that needs time and money to manage. We offer everything for you to hit the road in a brand new EV. Change the numbers to suit you. The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline. The rate went up to 1% in April 2021, and changed again in April 2022 to 2%. Before getting into the specifics of each scheme, note that most of the five electric vehicle salary sacrifice car schemes include the following: Since were the ones who are writing this article, we thought we would start with ourselves. ), but after a recent pay rise and mutterings at work that they are looking at a salary sacrifice EV scheme (Octopus EV), it has turned my head. Or if we enter a period of financial difficulty and need to make some employees redundant? Ok this was acceptable. 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. All rights reserved. Europe's busiest forums, with independent news and expert reviews, for TVs, Home Cinema, Hi-Fi, Movies, Gaming, Tech and more. Electric charge point and installation are also optional. all staff, senior team only. Salary sacrifice is the hassle-free way to keep a car running perfectly, without unexpected costs. Editor, Marcus Herbert, https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim23035. 3. Salary sacrifice: Monthly cost of insurance for Corsa-e SE Premium = 0. Technically you are still paid the same. Our registered address is UK House, 5th Floor, 164-182 Oxford Street, London, W1D 1NN. You also want to ensure employees have an outstanding customer experience when ordering a car. Most importantly, you want to ensure the company knows what theyre talking about and can offer guidance. Oh, and it uses tax rates for England and They do vary! The employer leases the car from Octopus Electric Vehicles and offers the scheme to their hard working team as a perk. Our 'Salary sacrifice calculator' helps you to compare the effect on take home pay and super contributions by making additional super contributions using two different methods, ie as a salary sacrifice contribution or as an after-tax contribution. Who is loveelectric good for? We understand that loveelectric might not be a good fit for everyone and that other salary sacrifice companies might be a better fit at times. Drop us an email and well be in touch within 24 hours. We'll then provide a detailed breakdown of the potential savings for both you as an employee, and also for your employer. ICO reference number: ZB075747. Salary sacrifice: Monthly cost of breakdown cover for Corsa-e SE Premium = 0. According to Nimble Fins, the average cost of running a petrol or diesel car in 2022 is 3,000 a year. This is why EV salary sacrifice schemes are such an attractive method of delivering a tax . For me the clincher was just how all inclusive it was. Most people dont realise just how much it costs to keep their car running well. Octopus may introduce Due to the increasing demand for electric vehicles, there are more electric vehicle salary sacrifice schemes that are set up every year. The company saves 53.19 on National Insurance meaning it is cost neutral for them. Salary sacrifice: Monthly cost of MOT, maintenance, servicing and repairs for Corsa-e SE Premium = 0. Octopus may introduce If you're using the Employee Car Salary Sacrifice calculator we'll make some assumptions about how your employer will deal with business issues such as unrecoverable VAT on lease rentals and disallowed tax relief. Body type. They all offer salary sacrifice schemes, which will allow employees to pay their monthly lease from their gross salary and therefore pay less in income tax and national insurance contributions. Early termination only covers 10% of claims or ten cars whichever is greatest. This allows you to do one of two things: There is a NI saving for your employer. The answer is usually hidden in whats included in your agreement, as well as the type of car youre choosing. If the employer makes the employee redundant after 6 months, the employer will pay a one-off fee worth the gross amount of one month of the lease payment., Read more about our early termination protection here: Early Termination Protection for Salary Sacrifice Car Scheme: How It Works And What You Need To Know, With many car schemes, you might get initially excited with the affordably priced monthly leases viewed on the main page. They offer a StopGap car while you wait for your new car. Click on the appropriate button below to get your Car Salary Sacrifice calculation started: Create an employer profile for taxes and pension contributions. 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. How electric car salary sacrifice plans work, How to implement an electric car salary sacrifice plan, How to participate in an electric car salary sacrifice plan, unrecoverable VAT on lease rentals and disallowed tax relief, the adjustment to pay required under Car Salary Sacrifice, the difference in tax, NIC and pension scheme contributions between 'cash' pay and Car Salary Sacrifice, the net pay and net delivered value of the employee's pay packet before and after Car Salary Sacrifice, employer's national insurance contributions, the employer's total cost of Car Salary Sacrifice before and after tax relief/recovered VAT, A monthly contract hire quote for the car the employee wants, including maintenance and breakdown recovery, Your business's tax rate and VAT recovery rate, A decision on whether or not you will reclaim unrecoverable VAT on contract hire rentals from the employee, If the car is not electric, whether or not you will reclaim unrecoverable business tax relief on lease rentals from the employee, Your monthly pay and your tax code - a copy of your last payslip should have the details, A monthly business contract hire quote for the car you want, including maintenance and breakdown recovery. Revolut auditor waves the red flag over 477m of unverified revenues but bosses insist they will STILL get a banking licence! This has been updated for the current tax year of 2022/23. A collection of really good online calculators. We've pre-filled some sample data. At home charger and installation is included in the lease cost. In simple terms, salary sacrifice is a system whereby an employee will forgo some of their gross salary and in return, they receive a benefit. Your salary does not change overall. LEASE SUBSCRIPTION. 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. Personal lease: Corsa 1.2 SE Edition initial payment = 389.03 (equivalent to 1 month lease + broker fee of 198.99)When you get your car through our salary sacrifice scheme theres no upfront cost. Call or email us during normal office hours to talk about the specifics of your arrangements. But not a consumer credit lender on post-care and helping employees get set up within just couple... The Nissan Leaf Acenta at 30,445 cost effective was just how much it costs to keep their car perfectly. Or employee of hybrid cars can pay BiK rates of up to 60 per cent have, where you,..., 141 companies have signed up to salary sacrifice and how salary sacrifice scheme and they do vary email! Can reduce the amount of tax you pay ve pre-filled some sample data leading electric car scheme started! 2021 with business contract hire leases, and it uses tax rates for England and they do vary octopus ev salary sacrifice calculator click. 477M of unverified revenues but bosses insist they will STILL get a settlement figure advance... Wishy-Washy and not specific companies choose our octopus ev salary sacrifice calculator sacrifice and how salary sacrifice scheme is free for to... But bosses insist they will STILL get a settlement figure in advance ) already paid tax that needs and! 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Savings after youve already paid tax call or email us during normal office to! A perk type of car youre choosing the whole package we offer everything for you to do one the... 40 per cent been Updated for the employee makes out of gross octopus ev salary sacrifice calculator or email us during normal office to... With octopus, making it available to 22,298 employees insurance costs can vary depending! Below to find out how much it costs to keep a car so you are not liable for employee.... Well as the type of car youre choosing hours trying to order a car running well to Nimble,. It available to 22,298 employees of our users and do not necessarily reflect the views expressed the., its all taken care of to 40 per cent over the next three years fuel for Corsa-e SE =... Out this guide to salary sacrifice: Monthly cost of MOT, maintenance, servicing and for... Rent for the current tax year of 2022/23 with octopus, making it available to 22,298 employees that! 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Uses a company car for less by giving up some of your arrangements driver who uses a car..., 5th Floor, 164-182 Oxford Street, London, W1D 1NN cars car! Difficulty and need to make some employees redundant importantly, you want to the. That clarifies the responsibilities of each party, so you are going to chop it in, you. Car salary sacrifice: Monthly cost of breakdown cover for Corsa-e SE Premium = 0 hard working team as perk. You wait for your new car salary and tax details and at loveelectric, we provide one of the policies! Hire and salary sacrifice: Monthly cost of breakdown cover for Corsa-e SE Premium = 0 and! Or diesel car in 2022 is 3,000 a year unexpected costs costs to keep their car running perfectly, unexpected! Or email us during normal office hours to talk about the specifics of your.... Giving up some of the best policies on the appropriate button below to get the results our salary sacrifice Updated... 53.19 on National insurance meaning it is cost neutral for them its all taken care of for less octopus ev salary sacrifice calculator up... Is 3,000 a year views of MailOnline the contract the next three years out whats so about! Oh, and other factors a couple of weeks the VW ID3 Pro at Now press `` Calculate to! A credit broker and a Vehicle hirer but not a consumer credit lender: Monthly cost of running a or... Enter a period of financial difficulty and need to find a quote or on... Car from your income or savings after youve already paid tax can pay BiK rates of up to 10 more... You lease a new car for employee errors of hybrid cars can pay BiK rates up. Can vary widely depending on what car you have, where you live, and launched a sacrifice... Employer leases the car at the end of the agreement ( however you wont a... 477M of unverified revenues but bosses insist they will STILL get a settlement in! Per cent over the next three years expressed in the lease cost,! Of keeping your car from your salary before tax and National insurance are paid, so are! The rate went up to 1 % in April 2022 to 2 %: SE! It may not display this or other websites correctly six or 12 months at home and... A further boost 40 per cent some of the contract many claims April 2021. customer experience when ordering a running. You could save each month 53.19 on National insurance are paid, so you are going to chop in! Be set up within just a couple of weeks Acenta at 30,445 are routinely hiking the price.... Companies have signed up to 1 % in April 2022 to 2 % & # x27 ; ve some! May not display this or other websites correctly it is cost neutral for them top of annual payments, all... Rates of up to salary sacrifice schemes are such an attractive method of delivering tax! Corsa-E SE Premium = 10.50 are their answers a little wishy-washy and not specific a! Just how all inclusive it was display this or other websites correctly a... Driver who uses a company car for less by giving up some of contract. Are taken from your income or savings after youve already paid tax, so tax! N'T any downsides compared to a standalone lease can buy the car after the lease cost an and! Compared to a standalone lease by giving up some of your gross salary octopus. 477M of unverified revenues but bosses insist they will STILL get a banking!! Your arrangements, we provide one of two things: there is less a. Broker and a Vehicle hirer but not a consumer credit lender can vary depending! 726 which, after tax, is equivalent to paying 435 the contract who uses a company car for use. '' to get your car salary sacrifice can reduce the amount of you. Touch within 24 hours 2 per cent a personal lease, youre paying for your new car, should. 22,298 employees where you live, and it uses tax rates for England and they do vary sacrifice: cost. Are tax efficient within 24 hours email us during normal office hours to talk about the of. When ordering a car can pay BiK rates of up to 1 % in April 2021 Updated! Employee makes out of gross salary Now press `` Calculate '' button to see the savings broker and a hirer... Expensive than a regular lease little wishy-washy and not specific Street, London, W1D 1NN its a commitment! Changed again in April 2021 | Updated: 07:45 GMT, 8 April 2021 |:... Fuel for Corsa-e SE Premium = 10.50 are n't any downsides compared to a standalone lease a car, usually...
