Here you can discover how employees can save money with a car leased via a salary sacrifice car scheme. Savings of up to 58% are available making this a low-cost company benefit that also promotes green motoring. A salary sacrifice also aids employee retention and improves the overall benefits packages for employees.
Car salary sacrifice is a type of employee benefit that allows an individual to sacrifice a portion of their pre-tax salary in exchange for a brand new lease car. In other words, the employee agrees to give up a portion of their salary in exchange for the use of a car.
Under a car salary sacrifice scheme, the employer leases the car and provides it to the employee, who can use it for both personal & work-related purposes. The cost of the lease is deducted from the employee's gross salary before taxes are applied, resulting in a reduction of the employee's taxable income. This can result in lower tax liabilities and higher take-home pay for the employee.
It's important to note that car salary sacrifice schemes may not be available to all employees and the specific terms & conditions of such a scheme may vary between employers. Employees considering a car salary sacrifice scheme should carefully review the terms & conditions of the scheme and consider seeking independent financial advice before making a decision.
Salary Sacrifice car leasing schemes offer great benefits for both employers & employees alike.
In the UK, a "benefit in kind" (BIK) is a non-cash benefit provided by an employer to an employee as part of their employment package. The term "benefit in kind" is also referred to as a "perk" or "fringe benefit."
Some common examples of benefits in kind in the UK include company cars, private healthcare, gym memberships, travel expenses, and accommodation. The value of the benefit in kind is calculated based on the cash equivalent value of the benefit, which is then subject to tax and National Insurance contributions.
The benefit in kind tax is applicable to both the employer and the employee. The employer is responsible for reporting the value of the benefit in kind to HM Revenue and Customs (HMRC), while the employee is responsible for paying the appropriate tax on the benefit in kind.
Overall, benefits in kind can be a useful tool for employers to attract and retain talent, while also providing employees with additional perks and incentives. However, it is important to ensure that the appropriate tax and National Insurance contributions are paid on these benefits to avoid any penalties or legal issues.