Salary Sacrifice Car Scheme
A brand-new electric car for your employees, paid for from gross salary - with insurance, maintenance and breakdown cover all included. One of the most valued benefits a business can offer, and it costs the company nothing to set up.
What is salary sacrifice?
A salary sacrifice car scheme lets an employee exchange part of their gross salary for a brand-new car. Because the payment comes out of pay before tax, the employee saves income tax and National Insurance on the amount sacrificed - and the employer saves on Class 1 National Insurance contributions too.
The employee pays Benefit in Kind (BIK) tax on the car, but for electric vehicles this is deliberately kept low by the Government - 4% of the car's value for the 2026/27 tax year, a fraction of the rate charged on petrol and diesel cars. That's what makes the sums work so well: for an electric car, the tax and NI savings usually far outweigh the BIK, so the employee typically ends up 20-40% better off than leasing the same car personally.
The agreement sits between the employer and the employee, with Albany Leasing arranging and supporting the scheme throughout. There's usually no deposit and no personal credit check for employees.
What's included
Everything except the electricity. A typical Albany salary sacrifice package covers:
- A brand-new electric or low-emission car of the employee's choice, on a 2-4 year term
- All servicing, maintenance, MOTs and tyres
- Fully comprehensive insurance, including business use
- Breakdown cover and accident management
- Early termination protection for life's unforeseen events
- Full manufacturer's warranty throughout
What's in it for the employer?
- A standout benefit at no set-up cost. Schemes are free to establish and run, and work for small companies as well as large fleets - a powerful tool for attracting and retaining staff.
- National Insurance savings. The company saves Class 1 NI on every pound of salary sacrificed.
- Greener business. Moving employees into new EVs cuts your team's emissions and supports your sustainability goals.
- Minimal admin. We handle vehicle sourcing, quotes, ordering and delivery; your payroll simply processes the deduction.
What's in it for the employee?
- Significant savings - typically 20-40% cheaper than a comparable personal lease, thanks to tax and NI efficiency.
- One simple payment - car, insurance, servicing, tyres and breakdown cover in a single salary deduction. All they pay for is charging.
- No deposit, no personal credit check - the finance agreement is with the employer.
- A brand-new car every few years - with the latest technology, safety kit and range.
What if an employee leaves?
Life happens, and schemes need to cope with it. Our packages include early termination protection covering circumstances such as resignation, redundancy, extended unpaid parental leave, long-term sickness, or loss of driving licence on medical grounds - so neither the employer nor the employee is left exposed by an unexpected change.
How a scheme gets set up
- Underwriting. Your company is approved for finance by one of our panel of funders.
- Scheme terms agreed. We put the framework and employee eligibility rules in place with you.
- Employees choose their cars. Your team browse available vehicles and prices, with our account manager on hand to advise.
- Approval and order. The company approves each choice; we order the vehicles and arrange delivery to a location of your choosing.
- Payroll deduction begins. Your payroll processes the salary reduction, and we stay alongside you for the life of every contract.