Electric Vehicle Salary Sacrifice Calculator 2025/26

EV salary sacrifice allows employees to give up part of their salary (reducing gross pay) in exchange for a company electric vehicle provided by the employer. The employee pays Benefit in Kind (BIK) tax instead of income tax and NIC on the sacrificed salary.

Zero-emission vehicles have a BIK rate of just 3% in 2025/26 (rising to 5% in 2027/28). This means an employee only pays income tax on 3% of the car's list price as a benefit, rather than paying full income tax and NIC on the equivalent salary amount.

3% for zero-emission vehicles (ZEVs) in 2025/26. This rises to 4% in 2026/27 and 5% in 2027/28. Even at 5%, EVs are significantly cheaper than the equivalent fuel purchase, making salary sacrifice very attractive.

Yes — the employer saves 15% employer NIC on the sacrificed salary amount (from April 2025 rate). On a £550/month sacrifice, that's ~£990/year in employer NIC savings. Many employers pass this saving back to employees to make the package even more attractive.

Yes, but for ultra-low emission vehicles (≤75g/km CO2), OpRA uses the BIK value (P11D × BIK rate) rather than the higher of BIK or cash alternative. This means EVs are treated favourably under OpRA and retain their tax efficiency.

Yes — salary sacrifice can be used for cars of any price. The BIK is calculated on the P11D value × BIK rate. The monthly sacrifice amount is set by the employer to cover the lease cost. Most employers set a maximum P11D value (e.g., £50,000).

You may need to pay an early termination charge if you leave during the lease period. Many schemes have provisions for redundancy, ill health, or retirement. Check the scheme terms carefully before entering — the penalty can be significant.

A company EV through salary sacrifice includes insurance, servicing, road tax and tyres in the lease. You also save income tax and NIC on the sacrifice amount. Many employees find the effective monthly cost 20-40% lower than buying or leasing privately after tax savings.