A Salary Sacrifice Scheme allows employees to exchange part of their gross salary for valuable workplace benefits such as pension contributions, cars and cycle-to-work schemes.
RightLease helps businesses introduce flexible vehicle salary sacrifice options, giving eligible employees access to a new car while potentially reducing their Income Tax and National Insurance. A well-structured scheme can also strengthen your employee benefits package, support recruitment and improve staff retention.
Help your employees make the switch to a new electric or low-emission plug-in hybrid car with the RightLease Salary Sacrifice Scheme.
A Car Salary Sacrifice Scheme allows eligible employees to exchange part of their gross salary for the use of a new vehicle provided through their employer. Because the payment is deducted before Income Tax and National Insurance are calculated, employees may be able to reduce the effective monthly cost of driving a new car.
Fully electric cars currently provide the strongest tax advantages because they attract much lower Benefit-in-Kind rates than most petrol, diesel and conventional hybrid vehicles.
Certain low-emission plug-in hybrid cars can also be suitable, particularly when they offer a longer electric driving range and produce no more than 75g/km of CO2.
An Electric Car Salary Sacrifice Scheme is an agreement between an employer and an employee.
The employee agrees to reduce their contractual gross salary by an agreed amount. In return, the employer provides them with a new electric or qualifying low-emission car through a business vehicle lease.
The employee may save Income Tax and National Insurance on the salary they exchange. They will normally pay Benefit-in-Kind tax for using the vehicle privately, but electric cars currently attract significantly lower Benefit-in-Kind percentages than higher-emission vehicles.
The employee’s contract must be updated to reflect the arrangement, and their remaining cash salary cannot fall below the applicable National Minimum Wage.
The RightLease Salary Sacrifice Scheme is designed to make employee car benefits easier to understand, implement and manage. Instead of arranging a personal lease directly, the employee chooses an eligible vehicle through their employer’s scheme. The vehicle is leased under a business agreement and the agreed gross sacrifice is taken from the employee’s salary each month.
RightLease supports employers and employees through vehicle selection, quotations, lease terms, mileage requirements, order processing and delivery. We also provide the information needed to help the employer administer the vehicle through its HR and payroll processes. Vehicle availability, employee eligibility and exact scheme inclusions will depend on the employer’s policy, the selected funder and the final agreement.
Electric cars are currently the most tax-efficient vehicles to provide through a Salary Sacrifice Scheme.
For the 2026/27 tax year, fully electric company cars with zero tailpipe emissions have a Benefit-in-Kind percentage of 4%. By comparison, higher-emission petrol, diesel and hybrid cars can attract substantially higher percentages.
This means employees may be able to access a new electric car for a lower effective monthly cost than they would pay through a standard personal lease.
Electric cars can also provide:
The exact saving will depend on the employee’s salary, tax band, chosen vehicle, lease terms and personal circumstances.
Everything you need to know about leasing with RightLease.
A straightforward process for employers and employees, from setting up the scheme to driving away in a new vehicle.
RightLease helps your business define employee eligibility, vehicle choices, budgets, contract lengths and mileage limits.
Eligible employees compare the vehicles available through the scheme, including electric and selected low-emission models.
The employee receives a clear breakdown of the salary sacrifice, estimated take-home pay and Benefit-in-Kind tax before approval.
RightLease arranges the vehicle order and delivery, while the agreed payment is deducted from the employee’s gross salary.
Explore our recommended electric and low-emission cars for salary sacrifice. From affordable electric hatchbacks to long-range family cars and premium SUVs, these models offer a strong combination of practicality, technology and tax efficiency.
A Car Salary Sacrifice Scheme is also not automatically restricted to fully electric vehicles. However, electric and certain low-emission cars usually offer the strongest tax efficiency because company car Benefit-in-Kind charges are linked to the vehicle’s CO2 emissions and, for some plug-in hybrid vehicles, its electric range.
Higher-emission petrol and diesel cars will normally attract substantially higher Benefit-in-Kind charges. Cars producing more than 75g/km of CO2 are also generally subject to less favourable Optional Remuneration Arrangement rules, which can make them unsuitable for a tax-efficient Salary Sacrifice Scheme.
RightLease can help employers create a sensible vehicle policy that balances employee choice, affordability, emissions and taxation rather than simply offering every available model.
Electric cars are particularly well suited to salary sacrifice because they currently attract lower Benefit-in-Kind percentages than most petrol, diesel and hybrid vehicles.
For the 2026/27 tax year, a zero-emission company car has a Benefit-in-Kind percentage of 4%. This percentage is applied to the vehicle’s taxable list price before the employee’s Income Tax rate is used to calculate the actual tax payable.
This does not mean an electric car is tax-free. It means the taxable benefit can be considerably lower than it would be for a comparable higher-emission company car.
Electric vehicles can also provide lower day-to-day running costs, quieter driving, access to the latest technology and reduced tailpipe emissions. However, the correct vehicle should still be chosen around the employee’s regular mileage, charging access, passenger requirements and overall monthly budget.
Payments are taken from gross salary, which may reduce Income Tax & NI.
Drive a new vehicle without buying it outright or managing its future resale.
Avoid the large initial cost normally associated with purchasing a car.
Receive a clear breakdown of how the scheme will affect monthly take-home pay.
Choose from eligible ev's, plug-in hybrids, hatchbacks, SUVs and executive models.
Return the vehicle at the end of the agreement without having to sell it.
Enhance your benefits package without simply increasing cash salaries.
Attract new employees and give existing staff another reason to stay.
Employers may save National Insurance on the salary exchanged by employees.
Encourage the use of electric and lower-emission vehicles across your workforce.
Help employees move from older personal cars into newer, maintained vehicles.
Get help with quotations, applications, orders, paperwork and vehicle delivery.
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