Electric cars give a numerous environmental benefits but they can be quite expensive. However, if you sign up for a Salary Sacrifice Scheme, you can reduce the price of your electric car. How that works? Let’s get to know more about all Salary Sacrifice Scheme, how it works and is it worth to have?
What is a Salary Sacrifice Scheme?
A salary sacrifice scheme is an agreement between you and your employer. You agree to give up some of your salary in return for a non-cash benefit, usually a company car or healthcare.
The advantage of a salary sacrifice scheme is that it can be used to reduce your taxable income and, as a result, the amount of income tax you pay.
Benefits of getting a Salary Sacrifice Scheme
There are a few benefits that come with getting a salary sacrifice scheme.
Increased pension pot
One of the benefits is that a salary sacrifice can help to top up your pension. By paying into your pension before tax is deducted, you’ll immediately increase the size of your pension pot.
Reduced your tax bill
As mentioned before, a salary sacrifice can help to reduce your tax bill. When you give up part of your salary for a company car or healthcare, you’ll pay less income tax.
A company car with all the benefits
Another benefit is that you may be able to get a company car with all the benefits that come with it. This includes free road tax, fuel and maintenance.
A salary sacrifice scheme can also help to increase employee satisfaction. This is because employees feel that they are being rewarded for their hard work.
Environmental Benefits of Electric Cars
Electric cars are becoming increasingly popular due to their environmental benefits.
Electric cars produce zero emissions, which means that they have a much lower impact on the environment than petrol or diesel cars.
Electricity is a renewable resource, so electric cars are more environmentally friendly than petrol or diesel cars.
Good for our health
Electric cars also produce less noise pollution than petrol or diesel cars. This is good for our health as it reduces the risk of noise-related diseases such as heart disease and stroke.
Electric cars also help to improve energy security. This is because they reduce our dependence on imported oil.
Other Advantages of EV Cars
Cheaper to operate
Electric cars are cheaper to operate than petrol or diesel cars. This is because they are more efficient and have lower running costs.
Electric cars also have lower maintenance costs than petrol or diesel cars. This is because they have fewer moving parts and require less servicing.
Cheaper to get registration
Electric cars are also cheaper to get registered. This is because they are exempt from road tax and the London Congestion Charge.
How Salary Sacrifice works?
A salary sacrifice scheme works by you agreeing to give up part of your salary in return for a non-cash benefit, such as a company car or healthcare. The advantage of a salary sacrifice scheme is that it can be used to reduce your taxable income and, as a result, the amount of income tax you pay.
To take advantage of a salary sacrifice scheme, you will need to agree to it with your employer. Once you have done this, your employer will deduct the agreed amount from your salary before tax is deducted.
Is it worth it?
A salary sacrifice scheme can be a great way to reduce your tax bill and increase your pension pot. However, you will need to make sure that you are happy with the amount of salary that you are sacrificing. You should also make sure that you are aware of the other benefits that come with a salary sacrifice scheme, such as a company car or healthcare. Talk to experts, Fleet Evolution offer other services for your EV Cars. Learn more by visiting their website here https://www.fleetevolution.com/are-salary-sacrifice-schemes-worth-it/
Disclaimer: This is not tax or financial advice. You should speak to a qualified professional before making any decisions about salary sacrifice schemes.