Salary Sacrifice Lease Car Adjusted Net Income

Ducklingrm

Hi All, hoping someone might be able to clear up a query.

My employer have started to offer salary sacrifice electric car leasing scheme. Our first child is approaching nursery age and as such I am keen to plan my earnings to make the most of any support available.

Total gross salary £130000, at the moment I am sacrificing just over £30000 into my pension to reduce my adjusted net income below £100000. Allowing me to claim tax free child car and hopefully 30 hours free childcare when at a suitable age- whilst maintaining my personal allowance.

The GOV website is unclear as to what can be used to reduce adjusted net income. But would I be correct in saying that any leasing cost under the ULEV car scheme would reduce my adjusted net income. E.g £130000 income minus £20000 pension minus £10000 lease cost under car scheme would equal a £100000 adjust net income? Does a 2% BIK change anything?

Thanks 👍

Dazed_and_C0nfused

Total gross salary £130000, at the moment I am sacrificing just over £30000 into my pension to reduce my adjusted net income below £100000

E.g £130000 income minus £20000 pension minus £10000 lease cost under car scheme would equal a £100000 adjust net income? Does a 2% BIK change anything?

Your figures are a bit confusing.  Are you sacrificing £30k, so only £100k taxable income, plus £20k into a RAS scheme (which doesn't reduce taxable income but does reduce adjusted net income)?

Company benefits are taxable income and will form part of your adjusted net income just like any other taxable income would.

Ducklingrm

Apologies I should have been clearer. At the moment I am sacrificing £30001 into my pension to reduce my adjusted net income below £100000.

I would like to reduce this to £20001 and take out a £10000 per year lease on my works salary sacrifice electric car scheme. Hopefully keeping my adjusted net income below £100000. Assuming the new ULEV schemes reduce net adjusted income as well as pension contributions?