Is commercial property a great value investing opportunity? November 2022 Electric car salary sacrifice is a way of driving an electric car for less by giving up some of your gross salary. Personal lease: Monthly cost of lease for Corsa 1.2 SE Edition = 190.04. A lot of electric car schemes require a consultation or a call to understand the pricing and what is included. is a credit broker and a vehicle hirer but not a consumer credit lender. Any prices quoted are subject to changes in law, regulation, tax or duty beyond our reasonable control. Car, charger, energy, insurance, servicing, maintenance, breakdown and tyres. 4,000 free miles of home charging with Intelligent Octopus. 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. Making Tax Calculations Simple. Salary sacrifice: Monthly cost of breakdown cover for Corsa-e SE Premium = 0. 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. 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. "I don't see any cause for further discussion or comment. 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. 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. Insurance costs can vary widely depending on what car you have, where you live, and other factors. When taking out a personal lease, youre paying for your car from your income or savings after youve already paid tax. Our registered address is UK House, 5th Floor, 164-182 Oxford Street, London, W1D 1NN. Take advantage of our salary scheme through your employer. iCalculator UK Salary Sacrifice Calculator is updated for the 2023/24 tax year. The cost of the MOT isnt a problem for most drivers, but the cost of repairs that the MOT uncovers can be hefty. 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. 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. Fixed AmountPercentage of Salary, Annual Employee Contribution (%) The monthly lease could be too expensive for employees, or the early termination policy wont be a good fit. Click on the appropriate button below to get your Car Salary Sacrifice calculation started: Create an employer profile for taxes and pension contributions. 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. Customers ask us why the total cost of an electric car through salary sacrifice can seem higher than taking out a personal lease. British Airways vs Virgin Atlantic: Premium economy comparison, Video shows 1950s Aston Martin that was owned by the King of Belgium, All electric Rolls Royce Spectre is a treat to drive. Body type. Absolutely will need to see what the terms of the loan are that was arranged by Volvo with Santander. We work with a range of partners, including benefit providers and consultancies, to support their clients to drive electric. You wont know if your company is eligible until you apply. Because this payment comes out of your pay before any tax, it reduces your salary and in turn lowers your income tax and national insurance payments too. This means your net pay will go down by the amount you pay for the car, minus your tax savings. Our tax calculators are designed to make it easy for you to understand how much you pay and how your money is divided up. So their fee comes out of charging double rent for the first 6 months, as well as an additional fee to the employer.. For this reason, you want to ensure the team communicates clearly and quickly. Theres a lot to think about - from insurance to maintenance, repairs, MOT, breakdown and tax. You save on National Insurance on the amount of your salary that you sacrifice. On average UK drivers can expect to pay around 484 per year, according to Nimble Fins. All rights reserved. Inclusive of this is insurance, servicing and maintenance and 'generous' early termination terms for the business should the employee leave. You will see an alteration to your contract, where you agree to swap part of your salary in exchange for other benefits. HMRC treats the benefit separately from your salary, which means you pay the tax before it arrives into your bank account. 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). '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.'. Salary sacrifice: Monthly cost of tyres for Corsa-e SE Premium = 0. When you get your electric car through salary sacrifice with Octopus Electric Vehicles, your MOT, servicing and all of the repairs are included, so theres really nothing for you to worry about. You are using an out of date browser. It simply means their rental prices cannot match the ones of large leasing companies. We've split our Car Salary Sacrifice calculator between employers and employees. Each calculator provides the same analysis of pay but is simplified to allow you to enter your salary based on how you are used to being paid (hourly, daily etc). 17 min read. Copyright 2000-2023 M2N Limited E. & O.E. 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. Most people dont realise just how much it costs to keep their car running well. You also want to ensure employees have an outstanding customer experience when ordering a car. Select a specific online salary sacrifice calculator from the list below to calculate your annual gross salary (after salary sacrifice adjustment) and net take home pay after deductions. Sort by. A quick valuation on Carwow last night though had it at 34-35k. Below is a chart summarising some of the leading electric car schemes in the UK.. This website uses the TMDb API but is not endorsed or certified by TMDb. EV terminology you need to know. 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. Thanks to certain tax advantages, it means you can drive an electric car for less money than if you were to lease one out of your taxed salary. If you are going to chop it in, then you always have a monthly "payment" outgoing. They allow employers to set up an entire car fleet. Check out the video below to find out more. 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. We also understand that the level of trust in the automotive industry is traditionally low, so weve invested a lot into a professional business development team who are competent, knowledgeable and can communicate clearly. You may also find the following Finance calculators useful. There aren't any downsides compared to a standalone lease. By comparison, combustion vehicles are subject to a typical BIK tax of 25 to 35 per cent. This is Money takes a look at Octopus Electric Vehicles' new programme and explains exactly how salary sacrifice schemes work. We've pre-filled some sample data. Personal lease: Monthly cost of tyres for Corsa 1.2 SE Edition = 10.83Through our salary sacrifice scheme, well cover punctures and sidewall damage. Octopus Electric Vehicles Limited is authorised and regulated by the Financial Conduct 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. 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 You can calculate results based on either a fixed cash value or a certain proportion of your salary. Start by creating a personal profile with salary and tax details. Setting up on the scheme is easy. For context: -Mid 30s, father of 2 -Salary roughly 95k 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. The salary sacrifice calculator aims to illustrate how such schemes work from both the employee's and employer's perspective and assuming a neutral impact on the employer. 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 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. Each salary sacrifice calculator allows you to enter salary sacrifice as a fixed amount of a percentage of your Gross pay. Ideally, you want the confidence that employees will take advantage of the benefit and thats something that the provider should help with.. AIUI, the EV is then subject to 1% / 2% BIK until the end of tax year 2024/25 and anything could happen after that. 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. Thats why we make it super easy for drivers who use our salary sacrifice scheme by covering everything they need to hit the road in one monthly payment. You get taxed a small amount for the benefit of having the car, whilst making other savings on Income Tax and National Insurance. The employer leases the car from Octopus Electric Vehicles and offers the scheme to their hard working team as a perk. 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. 2. Monthly cost of the personal lease Corsa 1.2 SE Edition = 399.52. Wevee and loveelectric and other brokers make money by charging a commission on top of the rental. Use our quote tool to see what we can offer you and your team. Please read the important notes before proceeding to use this tool: So far, 141 companies have signed up to salary sacrifice with Octopus, making it available to 22,298 employees. Not a broker or leasing company: they are an authorised representative of a third party broker, Maintenance, servicing, MOT, breakdown cover and tyre replacements are optional rather than automatically included.. The company saves 53.19 on National Insurance meaning it is cost neutral for them. When you lease a new car, youll usually make an initial payment at the start of the contract. Salary sacrifice is a way of getting access to a brand new car through your gross salary and saving up to 40%. Authority, firm reference number 809736, company number 10754317. Octopus says it realised how good EV salary sacrifice was and decided to design a scheme that makes it easy and cost-neutral for companies to set up and run. Project Mondo G is a Mercedes G-Wagen in a puffer jacket, New Honda's Civic: family car with rebellious bad boy in its line-up, Advert for the 1998 first generation of the Audi TT, Ford scrapping 1,300 jobs in UK amid European overhaul. However, that means youll want to know how much that commission is. Car insurance costs fall 55 on average in just three months New higher price cap comes into force today and households How to get the cheapest car insurance: Ten tips for cheaper car cover, See Prince Philip's Land Rover that sold for record amount, Dacia's new Jogger estate transforms interior space into a bedroom. Octopus 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. Inside Octopus EV podcast . 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. 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. Salary. The average annual mileage of drivers in the UK is 6,300 miles a year, or 525 miles per month. A dealer etc will arrange this for you. 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. 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. 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. Not much post-care or educational content for employees. Even with the increase in BiK at 2% for electric cars; the tax is much lower than for hybrids, petrol and diesel cars. So, it can be a win-win situation. 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. You may already be familiar with other salary sacrifice schemes, for example things like cycle to work, pension or childcare schemes. Read this guide to Salary Sacrifice and How Salary Sacrifice can reduce the amount of tax you pay. Find out how. According to Nimble Fins, the average cost of running a petrol or diesel car in 2022 is 3,000 a year. 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