Did you know that only 15% of HR managers are aware of salary sacrifice schemes for vehicles, particularly electric ones?
Rivervale asked their 90K YouTube followers about this and discovered that a staggering 75% had no idea these schemes existed. That means only a quarter of people are privy to the incredible benefits available.
So, why should your organisation take an interest? Let’s explore why salary sacrifice schemes for EVs could be the best decision your workplace makes.
1. Employee Appreciation
For employees
Offering access to a brand-new car, coupled with financial perks, makes employees feel valued. A little recognition goes a long way.
For employers
Valued employees tend to give back with dedication and productivity. Ignore appreciation, and 43% of employees admit feeling demotivated when they feel unseen.
2. Reduced National Insurance (NI)
For employees
Salary sacrifice reduces gross salary before tax, lowering NI contributions. For example, sacrificing £300 from £2,625 saves £36 per month.
For employers
Employers also pay less NI on adjusted salaries. It’s a win-win for both sides.
3. Reduced Tax
For employees
Less gross salary means paying less income tax. Using the earlier example, a £300 reduction saves £60 in tax.
For employers
Helping employees save on tax shows support, building mutual respect and loyalty.
4. Lower Company Car Tax
For employees
EVs have a Benefit-in-Kind (BIK) rate of just 2% in 2024/2025, compared to up to 37% for diesel vehicles. A £30,000 EV costs £600 annually in BIK versus £11,100 for a diesel car.
For employers
Employees who save on essentials like transport are more stable and loyal, reducing turnover.
5. Reducing Carbon Footprints
For employees
Switching to an EV lowers personal CO² emissions. EVs are the future and increasingly supported.
For employers
Promoting green initiatives enhances employee well-being and mental health. A positive impact on the planet often translates to a positive mindset at work.
6. Exemption from ULEZ
For employees:
Clean Air Zones and Ultra Low Emission Zones (ULEZ) are expanding across the UK. EVs are exempt, saving drivers up to £12.50 daily or £4,562.50 annually in congestion charges.
For employers
Employees who save on commuting are less financially stressed, boosting satisfaction and loyalty.
7. Enhanced Employee Loyalty
For employees
Salary sacrifice schemes show that employers care, encouraging loyalty.
For employers
Retaining staff is far cheaper than hiring and training new employees. Keeping three loyal employees saves around £90,000.
8. A New Car for Less
For employees
Reduced tax, NI, and EV perks mean employees can drive a brand-new car for significantly less.
For employers
Offering these benefits helps attract and retain talent, giving your company a competitive edge.
9. Early Termination Protection
For both parties
Life changes, and plans may shift. Early Termination Protection covers resignation, long-term illness, maternity leave, or loss of driving licence. Employees feel secure, and employers avoid complications.
10. No Credit Check
For employees
Salary sacrifice schemes bypass credit checks, giving everyone a fair opportunity to participate.
For employers
Inclusive policies boost morale and enhance loyalty. Small gestures make a big difference.
Why your workplace should offer Salary Sacrifice Schemes on EVs
Is this the right move for your organisation? Considering the savings, loyalty, and well-being it fosters, the answer seems obvious.
Sometimes, spending a little upfront reaps massive rewards in the long term.
