Salary sacrifice p11 bik

William_fenton

Good morning,

I was wondering if anybody can help me as HMRC were a little unhelpful.

I have been offered a salary sacrifice company lease car which seems like a no brainer until I take into account the bik tax. As the cars I'm looking at are over the 120co2 ruling then the tax is pretty hefty.

My question is, if I am paying 100% of the lease car costs, does this go on my p11d as a contribution towards the bik? If so is it at the gross or the net amount I pay every month?
Or am I trying to have my cake, eat it and then drive off in a nice car!?!

Thanks

Will

zagfles

William_fenton wrote: »

Good morning,

I was wondering if anybody can help me as HMRC were a little unhelpful.

I have been offered a salary sacrifice company lease car which seems like a no brainer until I take into account the bik tax. As the cars I'm looking at are over the 120co2 ruling then the tax is pretty hefty.

My question is, if I am paying 100% of the lease car costs, does this go on my p11d as a contribution towards the bik? If so is it at the gross or the net amount I pay every month?
Or am I trying to have my cake, eat it and then drive off in a nice car!?!

Thanks

Will

You're not paying it though. The idea of salary sacrifice is that you sacrifice some salary, and instead your employer pays for the car.

The salary you sacrifice saves you tax and NI, as your salary is lower, but the benefit of the company car will count as a BIK, on which you'll be taxed.

Depending on how much salary you have to sacrifice, and what the BIK is, and what the running costs depreciation etc of the car is, you may be better or worse off. You'll have to do the sums.