The AVC vehicle salary sacrifice calculator represents a breakthrough in business and personal finance tools for those considering a vehicle through a salary sacrifice scheme. This innovative calculator is designed to provide users with a flexible and comprehensive way to assess the financial implications of entering into a salary sacrifice arrangement for their next vehicle. With an expansive selection of vehicles available, either from AVC's handpicked offers that promise excellent value or by allowing users to choose their own vehicle, the AVC calculator stands out by offering a personalized quote configuration experience.
Salary sacrifice schemes offer a unique opportunity for employees to acquire new vehicles through their employer without the need for a traditional credit check. This is because the credit risk is assumed by the employer, not the individual employee. Such an arrangement can be highly beneficial not only to those with less than excellent credit profiles but also to individuals with perfect credit scores. By bypassing the need for personal credit to secure a vehicle, employees can preserve their credit capacity for other investments that might offer returns, rather than tying it up in a depreciating asset like a car
Salary sacrifice is a popular scheme for both employers and employees to save money. Employers can save on National Insurance (NI) contributions, while employees can benefit from a wide range of perks like full maintenance, servicing, tyres, and breakdown recovery, which are often included in the salary sacrifice package.
The vehicle of choice for this scheme is usually an electric car, as they have low benefit-in-kind rates that can result in significant savings for both parties. With the generous government benefit-in kind net zero subsidies - currently just 2% on net zero electric vehicles - salary sacrifice becomes an even more attractive option for those looking to make a clean electric vehicle transition.
Salary sacrifice schemes can offer great benefits and savings to both employers and employees.
One of the main benefits is the reduction of employee National Insurance (NI) payments, which will be 2% less at 10% from January 2024 on earnings between £12,570 and £50,270. These NI savings apply to every employee member of the salary sacrifice scheme.
Vehicles of choice for salary sacrifice are usually electric cars due to low benefit in-kind rates of just 2% on net zero vehicles; this makes electric cars an excellent choice for employees. Employers operate a cleaner, greener fleet, lower their carbon footprint and by offering this scheme, it has an impact on positive recruiting and staff retention.
Salary sacrifice schemes have been around since the 1970's, offering a win-win solution for both employers and employees to save on cost and taxes. Over time, salary sacrifice has evolved into a useful tool for employees to benefit from pension plans, child care costs and most recently, electric cars.
The net zero electric car scheme is becoming increasingly popular due to the National Insurance contribution and tax savings it offers. With benefit-in-kind subsidies at just 2%, this has made it more affordable for employees to switch to cleaner electric vehicles, which for many is a new car bonus. For employers, this encourages positive staff recruitment and also retention.
Employee Guide to Electric Vehicle (EV) Benefits and FAQs
Transitioning to Electric Vehicles: Why It Matters
As the world shifts towards more sustainable solutions, electric vehicles (EVs) have emerged as a pivotal change in the automotive industry, especially against the backdrop of the government's plan to ban the sale of new petrol and diesel vehicles in the future. Understandably, employees might wonder why moving away from traditional petrol or diesel vehicles is beneficial. The answer lies in the forward-thinking approach towards cleaner, more cost-effective motoring solutions
Setting up a car salary sacrifice scheme for your company, partnership, or organization can significantly enhance your employee benefits package, making it more attractive to current and potential employees. AVC offers comprehensive assistance in both setting up and managing these schemes, ensuring they are tailored to meet the specific needs of your business and your employees. The process involves altering the terms of an employee's employment contract to include this non-cash benefit, which must be agreed upon by the employee
Salary sacrifice is a fantastic option for companies looking to offer their employees a brand new electric vehicle that can also be fully insured and maintained. This scheme allows employers to lease electric cars to their employees, with the costs deducted from the employees' salary as a non-cash benefit. This is a tax-efficient way of offering an incentive to employees, as it can result in additional Tax and (NICs) savings.