Salary sacrifice car schemes are one of the most affordable and accessible ways to drive. Not only do they give you access to reliable, modern cars, they boast tax savings, predictable monthly costs, and offer an easy route to drive an electric.
But how do they actually work? And are they good value for money?
We’ll explain how salary sacrifice works, what you can save, and the key things to consider before signing up.
What is a salary sacrifice car scheme?
A salary sacrifice car scheme is an employee benefit that gives you access to a car and all-inclusive* package in exchange for a proportion of your pre-tax salary.
This reduces the amount of National Insurance and Income Tax you pay, making it much more cost-efficient than a personal lease.
The contract is between your employer and the scheme provider (that’s us!), and you’ll enter an agreement with your employer. Most schemes offer term lengths between 2-4 years, so you’ll have the option to upgrade your car every few years.
What’s included in a salary sacrifice car scheme?
As well as a brand-new or quality-assured used car, Zenith’s all-inclusive* package includes:
- Fully comprehensive insurance
- Servicing, maintenance, and repairs
- Tyres and glass cover
- Breakdown cover
- Road tax
- Accident management
This means fewer surprise costs, less admin, and simple budgeting.
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What’s not included?
Manufacturer subscriptions, the end-of-contract collection fee, and increases to road tax (which will be subject to VAT), and Electric Vehicle Excise Duty (eVED) aren’t included.
Can you drive an electric car via salary sacrifice?
Yes, in fact salary sacrifice is one of the most affordable ways to make the switch to electric. As well as lower Benefit-in-Kind (BiK) rates, EVs also have lower fuel costs, so you keep saving long after delivery day.
Are there any deposits or upfront costs?
With Zenith, there are no deposits or upfront costs, so you can get that new car feeling without taking a hit to your savings.
What do I need to consider before signing up to a salary sacrifice scheme?
Salary sacrifice can be incredibly cost‑effective, but it might not be the best option for you if:
- You plan on switching jobs and leaving your employer (as there may be early termination costs).
- You’re about to go on maternity or adoption leave (as it can reduce your pay).
- You anticipate a big lifestyle change that will impact your finances.
This doesn’t always have a big impact, but it’s worth reviewing.
Salary Sacrifice For Employees
Save on tax and enjoy all-inclusive driving when you get an EV with salary sacrifice. Find out more about the salary sacrifice benefits for employees.
Is salary sacrifice worth it for you?
A salary sacrifice car scheme is right for you if you want:
- A cost and tax-efficient way to drive
- Predictable monthly costs
- Easy access to an electric car
- An all‑inclusive, hassle‑free package
- No deposits or upfront payments
* Salary sacrifice pricing includes all maintenance and servicing, road tax, insurance, breakdown and recovery, tyres, glass and accident management. It excludes the cost of manufacturer subscriptions, the end-of-contract collection fee, any increases to road tax (increases will be subject to VAT) and eVED (from April 2028). You will not own the car and may be required to provide annual mileage information. T&Cs and exclusions apply, check your employer’s scheme policy for details. Subject to eligibility. Benefit-in-Kind (BiK) tax payable. Savings dependent on tax band.
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