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How does Salary Sacrifice Work?

Salary Sacrifice enables your employees to lease a brand-new vehicle of their choice through the company, which the employee covers the cost of by sacrificing a portion of their gross salary. There are significant financial benefits to both the employer and employee, especially when an electric vehicle is chosen.

Here at SalSac, several partners work together to ensure a smooth, compliant, and hassle-free experience for both employers and employees. Each party has a specific role to play, with SalSac bringing the process all together.

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  • The Funder: Owns the vehicle and leases it to the employer for the duration of the agreement. The agreement will be a Business Contract Hire, very similar to any business lease.

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  • The Broker: Acts as the main point of contact between the business, employees, and funder, managing vehicle quotations, orders, and delivery.

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  • SalSac Administration: Handles all calculations related to the salary sacrifice arrangement, including Benefit-in-Kind (BIK), tax, and National Insurance savings.

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  • Payroll Reporting: Managed by SalSac, ensuring accurate deductions, compliance, and ongoing support for both employer and employee throughout the lifecycle of the scheme.

How Do Your Employees Order Their Vehicles?

1

The employee selects their vehicle, obtains quotations and their salary deductions are calculated

2

The company and employee provide confirmation of the order and the vehicle is ordered through a manufacturer authorised dealership

3

The estimated delivery date is provided to the employee and you sign the vehicle hire agreement

4

The employee addendum to the employment contract is completed & charger fitted if applicable

5

The vehicle is delivered and salary deductions commence via your payroll department

6

The employee is provided with contact details to assist with any queries they may have during the lease

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Comprehensive Management from Start to Finish

At SalSac, together with your broker, we take care of the entire salary sacrifice car scheme process from setup to ongoing management, so you don’t have to worry about a thing. Our end-to-end service ensures everything runs smoothly for both your business and your employees.

 

Seamless Setup and Administration

We start by guiding you through the initial setup, ensuring that your scheme is compliant, efficient, and tailored to your company’s needs. This includes:

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  • Assessing employee eligibility and setting clear participation criteria

  • Arranging your company's credit line to support vehicle orders

  • Providing detailed vehicle quotations for each employee

  • Calculating salary deductions, income tax & National Insurance savings & Benefit-in-Kind (BIK) values

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By managing these crucial elements up front, we make implementation straightforward and stress-free.

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