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Best Electric Cars to Salary Sacrifice

Salary Sacrifice is a great way to reduce your tax bill while enjoying all the benefits an electric car has to offer.


But what is the best type of car to lease through an electric car scheme and currently what are the best vehicles available? These questions are important when considering a car salary sacrifice as the choice can profoundly change the cost of the vehicle and the benefit in kind payable.



Electric Car Types

Currently, in late 2022 there are three main types of electric cars. The first is a mild hybrid or MHEV. These EVs are fueled solely with either petrol or diesel but also have a battery and motor designed to increase efficiency. The second is a plug-in hybrid or PHEV which is also fueled the same way, however, these electric cars can also run without the engine on pure electricity. The driver charges the battery either at home or at a public charge point and when the battery runs out of power the engine kicks back in and runs the car. These plug-in hybrids have relatively small batteries with electric ranges anywhere between 20 and 70 miles. These plug-in hybrids also include clever recharge technology to also increase efficiency through braking.


The final version of an electric car is the all-electric vehicle. As the name suggests these cars can only be charged with no other fuels required and run on pure electric power. These cars are available with different-sized batteries measured in "kWh" kilowatt hours and different-sized motors measured in "kW" kilowatts. Below is an example of a VW e-UP.


Volkswagen Electric Hatchback 60kW E-Up 32kWh 5dr Auto


Here the 60kW refers to the power of the vehicle which in this case relates to about 82bhp or brake horsepower. The 32kWh here refers to the battery size and therefore how far the car will drive. The bigger this figure the further an electric car will drive but the longer the car will take to charge.


So why is this relevant to a car salary sacrifice?

Well, the type of car, or to be more specific the CO2 produced and the electric range of the vehicle dictates the Benefit in Kind or the BIK payable to the government as a monthly fee. The BIK payment is calculated through a percentage of the vehicle value. The more CO2 produced by the car and the lower the electric range the higher the BIK percentage and therefore the higher the payment. Please see the table below for example costs which clearly demonstrates how cheap fully electric cars are when salary sacrificed and how expensive it can be to salary sacrifice a standard hybrid. We have highlighted the lower rate, of the all-electric vehicles.

Car

Fuel Type

Electric Range

BIK %

Cost/month

Audi A3 TDI

Diesel

0

29%

£322.08

Nissan Qashqai

Hybrid

0

33%

£337.43

BMW X3

Hybrid

0

37%

£594.69

VW Golf e-Hybrid

Plug-In Hybrid

43

8%

£81.21

Range Rover Sport

Plug-In Hybrid

70

5%

£159.25

Fiat 500e

All- Electric

200

2%

£17.32

Tesla Model Y

All- Electric

300

2%

£37.44

As you can see, the UK Government has designed and organised the scheme to stimulate the electric car market and promote these cleaner vehicles, especially the fully electric vehicles which only attract a 2% Benefit In Kind.


So what electric lease cars are currently available?


Stocks of electric cars in the UK are returning to reasonable levels after the pandemic and shortages in electronic components are also decreasing. Please see our top five lease cars to salary sacrifice.


Top 5 Electric Cars to Lease with a Salary Sacrifice

1. Tesla Model 3

The Tesla Model 3 is an all-electric, 5-door vehicle with an estimated 235 - 300 mile range. Learn More

2. Audi E-Tron GT

3. BMW iX

4. Audi E-Tron Estate

5. Kia Niro

For more information regarding salary sacrificing an electric car please call our team on 0300 174 6768 or email us at enquiries@salsac.co.uk.

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