Electric Cars / Employee / Salary Sacrifice

How you can get behind the wheel of an electric car

Are you one of the thousands of drivers who would love their next car to be electric but feel that the price is prohibitive? The good news is that Tusker’s salary sacrifice schemes in partnership with CPC Drive provide a far more affordable way to get behind the wheel of a brand new electric or hybrid car.

At Tusker, our aim is to get everyone in the UK driving a newer and greener car at the most affordable price. Thousands of people are utilising a salary sacrifice schemes, something that’s driving the uptake of more ultra-low emission vehicles (ULEVs). In fact, in Q1 2023, 88% of our orders were for electric or hybrid cars with our top ten most-ordered cars all electric. Compared to 2019, when only one electric car made it into our top ten most popular vehicles, you’ll see that this is a major change.

Why are so many people going electric via Tusker?

Cleaner cars offer low-cost driving.

EV and hybrid drivers typically enjoy cheaper running costs thanks to charging being cheaper than fuelling a petrol or diesel car. While the cost of electric varies greatly between where and when you charge, saving money by charging at off-peak times is not a luxury any combustion car enjoys. EVs also enjoy the freedom of many cities that have recently introduce emission charges for petrol and diesel vehicles. Living or commuting within a clean air zone with a combustion car is quickly becoming unaffordable for many.

All these savings add up to significant reductions in comparison to driving a petrol or diesel equivalent. But this is just the tip of an enormous cost-saving iceberg. Because it’s not only day-to-day driving costs that reduce with ULEVs, but the vehicles themselves. And that all down to a major change in the tax treatment of electric and hybrid vehicles by HMRC.

Historically, electric and hybrid cars were much more expensive than their fossil-fuelled cousins largely due to the costs associated with battery production. However, in recent years, although prices have come down, up-front price remained a stumbling block for many drivers. HMRC then decided to throw the full weight of the UK’s tax regime behind the transition to a net zero UK economy by incentivising drivers to take up electric and hybrid cars with enormous tax breaks.

How salary sacrifice makes ULEVs affordable

Electric cars enjoy considerably lower Benefit in Kind (BIK) rates than their combustion counterparts. From 2023 BIK is set at 2% until April 2025, with rates rising by 1% each year thereafter until 2028. EVs are perfect for those wanting to obtain a car via salary sacrifice.

It’s attractive for employers too, as tax and NI savings can be made on ULEVs, so there are savings of over half a million pounds* available for some employers.

For ultra-low emission hybrids, the amount of tax and national insurance you’ll save will depend on the emissions of the car you choose to drive. The lower the emissions and the longer the car’s electric-only range, the less tax you’ll have to pay. This means ULEVs attract much lower BIK rates than their petrol and diesel counterparts.

It’s this potential for enormous tax savings, plus the low-cost day-to-day driving offered by these cars, that has galvanised drivers to embrace electromobility. And salary sacrifice brings other benefits too.

Find out more about Benefit in Kind

No deposit and no hidden costs

Buy a brand new electric or hybrid car outright and you’ll need tens of thousands saved and ready to go or a decent deposit and a loan. Alternatively, you could take out another form of finance – like PCP or PCH – which only cover the cost of the car leaving you with additional bills for items like insurance.

With salary sacrifice everything’s different:

  1. No need for a deposit – your first deduction is taken directly from your salary and you’ll know exactly how much this will be for every single month of your agreement. We don’t ask for credit checks either.
  2. Regular monthly amounts – the same amount is taken monthly, directly from your pay before it hits your bank account, so you won’t have to worry about an un-budgeted expense.
  3. The monthly amount includes everything you need – from insurance, road tax and breakdown cover to routine servicing, MOTs, maintenance and more, your monthly deductions provide a comprehensive motoring package.
  4. Major tax and national insurance contributions – during the 2020-2021 tax year, you’ll save your entire tax and NI contributions on the monthly amount for an electric car.
  5. A shiny new car every few years – at the end of the agreement, you can either hand the car back, purchase it, or take out an entirely new car – your old car is picked up and you get a brand new car to replace it with a fresh battery and all the latest tech, infotainment and safety features you could want.
  6. You’re protected from lifestyle changes – if you leave your job, get made redundant or go on long-term leave, there are protections in place to cover most circumstances (we advise you check your scheme policy for full details on what is covered).

That sounds good, but what does all this mean in pounds and pence? On average, Tusker drivers could save an average of £300 per month in income tax, Benefit in Kind and National Insurance.

All these ULEV savings add up to a very attractive and cost-effective package that removes the up-front vehicle cost hurdle for increasing numbers of drivers. If you’re ready to join the ultra-low emission driving revolution, compare cars and create your no obligation quote today.

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