Tusker Guest blog: Cut costs and drive greener

With rising living costs, businesses are searching for ways to help employees save money without affecting their own budgets. Employee benefits have long been a tool to add value beyond salary and offering an electric vehicle (EV) through a car salary sacrifice scheme is an increasingly popular way to make wages go further.

The rise of salary Sacrifice for EVs

Car salary sacrifice schemes have gained traction as a cost-effective solution for driving electric, hybrid, or low-emission cars. These programmes allow employees to access new vehicles with fixed, all-inclusive costs, offering peace of mind with no unexpected expenses. There’s no need for large upfront deposits, and protections are in place if personal circumstances change.

The additional bonus is that with two thirds of people able to charge at home* and take advantage of cheaper charging rates for their electricity, drivers are reporting savings of £1000 a year in fuel alone; many EVs can be fully charged for less than £6 under EV energy tariffs widely available from a variety of energy suppliers.**

Tax and NI savings: A game-changer for employees

On top of fuel savings, employees benefit from tax and National Insurance reductions through salary sacrifice schemes. Drivers typically save over £320 per month, significantly more than with traditional leasing.

Public sector employers can also reduce costs, especially in areas like Class 1A NI and pension contributions, due to the pre-tax salary deductions for the vehicle. For example, local authorities and NHS Trusts report savings of around £6,000 per EV over a typical lease term.

Supporting sustainable travel and Duty of Care

A car salary sacrifice scheme not only helps employees financially but also supports employers’ duty of care responsibilities. With 50% of the UK workforce commuting by car, offering access to safe, modern, low-emission vehicles aligns with health and safety obligations. Unlike personal vehicles, cars acquired through salary sacrifice schemes come with comprehensive insurance that covers both commuting and business use, ensuring that employees are always covered on the road.

Attract and retain top talent with employee benefits

Since vehicle costs are often the second largest expense for employees after housing, offering access to affordable electric cars can significantly enhance your employee benefits package. This can lead to higher employee satisfaction, attracting and retaining talent, particularly among those who prioritize sustainability.

Incorporating a salary sacrifice car benefit scheme could be your next step in providing value to employees while supporting green travel initiatives and ESG goals.

*source: British Gas

** source: Tusker data