Salary Sacrifice Car

macgyver

Hi all,
I work for the NHS and got trapped into buying a Salary sacrifice ar through my employer. I got attracted by the idea that I will be paying less per month as the money goes out before tax and NI is deducted and I bought a fully electric (expensive car) because it was promoted as a zero BIK tax for 2020 and 1 % for 2021 and 2% for 2022.
But now I have realised that my pension contributions have gone down as well as my total salary is less and more importantly I will be hit with Anual allowance hit when I come out of it as the pension will show a pseudo-growth.
What's the best way out of it?
Someone was suggesting to come out of pension for a short time (?few months) when I leave the salary sacrifice scheme (return the car). 
Is this advisable or any other suggestions?
Thanks

Barny1979

I hate it when I'm trapped into buying a brand new car. 

Thrugelmir

If you are buying the car. Why the benefit in kind charge? 

Where's your NHS pension invested to obtain pseudo-growth? 

macgyver

Thrugelmir said:

If you are buying the car. Why the benefit in kind charge? 

Where's your NHS pension invested to obtain pseudo-growth? 

Sorry, I phrased it incorrectly. I leased the car through salary sacrifice scheme.

macgyver

The Annual Allowance charge is applied if the pension growth is more than 40k per year.
As I am contributing less to pension currently due to Salary Sacrifice, I might go over the AA limit.
It is the usual NHS pension

sheramber

You can bring forward unused allowance from previous 3 years

https://www.gov.uk/tax-on-your-private-pension/annual-allowance

csgohan4

AA and the Lease car scheme are two different things

You need financial advice regarding the AA and way forward. It is a nice problem to have in some ways, mean you earn substantially more or contributed substantially to the scheme. 

Your options will be limited sadly. Either opt out of the scheme and pay more tax and have less pension when you draw, or continuing paying, pay AA tax and get more pension when you retire. 

Other avenues would be reasonable such EIS, but  it seems like a gamble imo and they will not reduce your AA charge, only your taxable income. 

NHS pension is a DB scheme and the contributors are unable to have any say in the investments. It is still one of the best pensions out there however.