Are there any details that i should be thinking about. Looking at my current PCP coming to an end and looking at the numbers it might make sense.
Will it affect pension percentage, student loan, NI, is there a BIK tax, etc. Just trying to get an idea of what to be aware of and whether there are any costs i am not aware of.
With mine the cost per month quoted is the price I pay which includes insurance, servicing, tyres, etc. NI, BIK and all that should be adjusted for by payroll as part of the quote. Check the details of your pension as if the payment is deducted before your pension you will pay less in to it so that obviously may affect your pot. Our scheme pays pension before car calculations so doesn't affect it. This was done as we were on final salary although that's now changed to career average.
It can be a good scheme, especially if you get a car from stock rather than speccing your own.
Will it affect pension percentage,that depends how your employer handles pensions
yes that is calculated on your taxable income - your repayment will go down, that may be good or bad news depending on your situationstudent loan
Yes you and your employer will pay less, NI,
yes,is there a BIK tax
the scheme providers often have a calculator - if not there are other online ones.etc. Just trying to get an idea of what to be aware of and whether there are any costs i am not aware of.
Make sure you check with your employer. Out scheme does affect pension contributions, but that's not stopped a lot of people getting a leccy car at work for a reasonable all in monthly fee (insurance/maintenance etc).
Ours comes off before pension, but we are able to top up the pension manually, so that is what I intend to do (waiting for mine to come at the moment).
I found that electric had the best deals, followed by hybrid, then petrol, then diesel.
The deals are cracking though, means I can get out of the Hyundai and into a BMW which just wouldn't be affordable if buying 'normally'
You need to look up the specific details of what your employer scheme offers OP, but key factors in how good it might be for you will include whether you are a higher rate tax payer (depending on nation you are in etc, but salary sacrifice generally benefits higher earners), whether you want to go electric (BIK is still much more generous over petrol/diesel despite ongoing changes), and crucially whether you are happy having your car tied to your employer and the termination costs if you quit.
Thanks for the comments,
Only a standard rate tax payer, but with a student loan, which I am never going to pay off, so it is simply additional tax which according to the calculators I have used would be reduced.
The choice is electric or hybrid,
I guess I need to speak to HR about the pension, yes I can bump it up a couple of percent to offset if necessary. and have a proper read of the T&Cs to see if it'll work generally.
Re the pension, it doesn't affect the percentage but it does reduce the salary on which the percentage is applied - so the £££ will reduce.
If you can up it to retain the same £££ then great, just be aware that if you're paying the maximum that the company matches already, then their element will also go down so you may have to cover their bit too just to stand still.
Depending on what cars you are looking at it may be worth checking what deals are around, often you'll pay list on a sacrifice scheme but can get discounts etc from dealers selling from stock.
You also need to check the small print regarding what happens if you change jobs during the term as it'll often mean losing the car and paying additional charges.
They aren't bad deals through work, especially when you factor in £50 a month that insurance is likely to cost, and they all get free recharging at work - that's getting tricky these days as there are 8 bays in our multi story, and they are filled up from about 8am, and folk don't shift their cars when charged.
I checked out the options for my wife on a salary sacrifice and it made more sense for us to buy a secondhand EV as they have jawdropping depreciation.. I guess if you are the type to have to drive a brand new car or want to 'get out of a Hyundai into a BMW' then it is probably the cheapest way of doing that but it still didn't make sense to me for what is basically a car rental scheme.
Depending on what cars you are looking at it may be worth checking what deals are around, often you'll pay list on a sacrifice scheme but can get discounts etc from dealers selling from stock.
As I mentioned above, you can get much better deals with my provider (Tusker) if you buy from the available now / coming soon section. That's what I did and don't think I'd have specced the car any differently anyway as the dealers tend to add the popular options and colours for their stock cars.
