Salary Sacrifice Schemes?

I've been looking at / becoming tempted by this recently too so this thread is good timing.

Can't help but think I've got my numbers wrong though, I had an E golf at c£275 / month gross which felt close to a no brainer with similar benefits to me in terms of child benefit etc, plus I'm in Scotland so marginally better tax benefit. Need to have a more thorough look before April
 
rodenal said:
I've been looking at / becoming tempted by this recently too so this thread is good timing.

Can't help but think I've got my numbers wrong though, I had an E golf at c£275 / month gross which felt close to a no brainer with similar benefits to me in terms of child benefit etc, plus I'm in Scotland so marginally better tax benefit. Need to have a more thorough look before April
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electric cars are cheaper after 1st April
 
These schemes are soft targets and extremely low-hanging fruit for a chancellor eager to raise taxes because they are politically easy to do since the general public scoff at "pampered" drivers in these schemes. Many car schemes are now a four year commitment so prepare for payment increases during that term if the chancellor changes the rates or decides to raid this area of what is seen as tax avoidance. For this reason, I got out of company car mechanisms since it is too long a commitment in an area that is constantly being raided by the chancellor. By the time you've finished paying the tax, certainly as a 40% tax payer, you could have bought the car outright after four years.
 
The scheme I've been discussing with the OP only offers two or three year terms.

If anything an EV is highly attractive to 40% tax payers with 0% BIK from April. Why would you want to pay 40% income tax then full price for PCP/PCH/finance on a car out of what's left?
 
kirkster said:
These schemes are soft targets and extremely low-hanging fruit for a chancellor eager to raise taxes because they are politically easy to do since the general public scoff at "pampered" drivers in these schemes. Many car schemes are now a four year commitment so prepare for payment increases during that term if the chancellor changes the rates or decides to raid this area of what is seen as tax avoidance. For this reason, I got out of company car mechanisms since it is too long a commitment in an area that is constantly being raided by the chancellor. By the time you've finished paying the tax, certainly as a 40% tax payer, you could have bought the car outright after four years.
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Nope

I can drive a 65k car for two years and be £200 a month better off than I am right now. The tax savings, fuel savings and car maintenance savings are not to be sniffed at.

Thats going electric though, I guess petrol would be a very different outcome.
 
kirkster said:
By the time you've finished paying the tax, certainly as a 40% tax payer, you could have bought the car outright after four years.
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Sort of, but only if you buy used. Ive been looking at new company cars, and essentially 550 gets me into a BMW/MERC/VOLVO or £200 gets me into a PHEV. No chance of getting an equivalent new car for that money, not if you are doing any reasonable mileage anyway.
 
MagicBoy said:
The scheme I've been discussing with the OP only offers two or three year terms.

If anything an EV is highly attractive to 40% tax payers with 0% BIK from April. Why would you want to pay 40% income tax then full price for PCP/PCH/finance on a car out of what's left?
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I agree. However, your point is only valid if the current situation is maintained. My previous commentary is that I do not think it will be and that the government is constantly finding ways to hammer any form of tax break on these vehicle purchase/hire mechanisms. The government is eager for money. They promised not to raise direct taxes. So they need money from somewhere. There will be stealth taxes aplenty heading our way and this area will not go untouched by the chancellor. I was a company car man for 30 years and eventually gave up with them.

I agree, it depends on the car choice and your annual mileage whether or not it is worth it in an individual situation. But the strategic direction of any tax limiting mechanism is up, up and up.
 
Well I've just ordered one on a two year deal. Audi E-Tron Sport in Floret Silver. Not bad for £386 a month.
What it actually means for me though, is that over those two years I'll be making other savings of £4,004.32.
 
TheOracle said:
Well I've just ordered one on a two year deal. Audi E-Tron Sport in Floret Silver. Not bad for £386 a month.
What it actually means for me though, is that over those two years I'll be making other savings of £4,004.32.
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Wise to keep it short so that you can review your options.
Enjoy the new car. I'm not wanting to **** on anyone's parade, I just think such long term commitments need to be approached very cautiously in this area. Government could do something like introduce a tax on PCP payments etc... Who knows....
 
kirkster said:
Wise to keep it short so that you can review your options.
Enjoy the new car. I'm not wanting to **** on anyone's parade, I just think such long term commitments need to be approached very cautiously in this area. Government could do something like introduce a tax on PCP payments etc... Who knows....
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Yeah, I didn't want any more than a 2yr deal, and the fact the 2yr was cheaper. Like you say, gives me options.
 
kirkster said:
I agree. However, your point is only valid if the current situation is maintained. My previous commentary is that I do not think it will be and that the government is constantly finding ways to hammer any form of tax break on these vehicle purchase/hire mechanisms.
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Long term I don't disagree. Within the 2 years lifespan of these lease deals it's highly unlikely. As it stands it's attractive and can save thousands of pounds.
 
TheOracle said:
is this still applicable on salary sacrifice as I thought tax was in with the deal? another reason to go for it imho
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It will almost certainly be included in the monthly cost.

Another couple of things to consider:

Your student loan contributions will go down as your effective salary at the point your liability is calculated will be reduced.

Your pension contributions will go down for the same reason as above.

Out of interest, who is the scheme with?
 
Haggisman said:
It will almost certainly be included in the monthly cost.

Another couple of things to consider:

Your student loan contributions will go down as your effective salary at the point your liability is calculated will be reduced.

Your pension contributions will go down for the same reason as above.

Out of interest, who is the scheme with?
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TuskerDirect
 
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