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Does Applying for a Car Salary Sacrifice Save You Money?

 Car Salary Sacrifice

Owning a new car is not easy, they are not cheap. So, finding a way that can save you money on the cars you really want is important. One such way is through the use of a salary sacrifice scheme. It's something that has been around for many years and can be used in different ways to help reduce your carbon footprint, but it also helps you get access to better quality cars for less money.

How do they work?

A salary sacrifice car scheme is a way of buying a new car that is not like the traditional method. Rather than paying for the entire value of the vehicle as one lump sum, you use your net pay (after tax) to purchase it over time. So rather than receiving each payment as you normally would, part of your wage goes towards repaying a low-interest loan on the vehicle of your choice.

Your company can choose to offer this scheme, or you can use a third-party provider such as LeaseCar. In either case, the car is registered in your name with a logbook and a service schedule. You simply pay for most things related to the vehicle through your salary sacrifice plan before tax and NI contributions come out of it.

This is a good way to afford a brand new vehicle without having to front the entire cost. You can benefit from a tax reduction as well because of the way salary sacrifice schemes work.

What do you get out of it?

There are a number of benefits that come with using a car salary sacrifice scheme, including:

  • The ability to have access to better quality cars without having to pay  for it all upfront
  • A saving on road tax because you are buying a new car
  • You can take advantage of manufacturer offers including interest-free credit. This often means it will be more affordable to own the vehicle
  • Your company may match your contribution making it even better value for money

Some of the schemes even offer discounts for electric vehicles and hybrids. So, if you want to go green and save money at the same time, these schemes are a great way to do it.

It's easy to see why more people are choosing this as a method of buying a new car. It offers flexibility as well as considerable savings on your initial outlay, especially when combined with finance deals.

Do your research 

Company car salary sacrifice schemes are different depending on where you choose to do it. Thus, ensure you do your research on the options available to you before making a decision. There are some great deals on cars out there right now, and salary sacrifice schemes can be a big part of that.

So, if you want access to better quality cars for less money, then salary sacrifice is a great way to achieve it. It's flexible and offers considerable savings on brand new cars.

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