Salary sacrifice electric car lease scheme - good value?

mroshaw
mroshaw Posts: 47
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edited 29 December 2023 at 10:19AM in Motoring
My company recently announced a salary sacrifice electric vehicle lease scheme, run by a company called Tusker. I'm in the 40% tax bracket and have recently invested in solar panels and an EV charge point for the house. I have a very old diesel BMW that's on its way out, so I'm looking very seriously at the EV market for a small car. Since COVID, I've been 100% home based, though I do have two school kids that need driving around. I estimated around 5000 miles for my insurance this year.

One thing that struck me immediately, is that the quotes I'm getting from the Tusker site don't seem as compelling as I thought they might be. For example, I'm looking at the VW ID 3, and Tusker quotes £349 per month over a 36 month lease. It's the electric Pro 58kWh 204 Auto model, 20" alloys, bike carrier hitch. Here's how that looks:

Monthly gross reduction:£555
Income Tax saving:-£222
National Insurance saving:-£11
Benefit in Kind:+£27
Effect on take home pay:£349

Is that a "good" deal for leasing this car? I was kind of hoping for something around £200 per month, maybe less. Am I living in cloud cuckoo land?!

I wondered if anyone has had any experience with such a scheme, and whether you've felt that it's really good value for money or not. I'm also interested in any feedback on Tusker, and the service they offer around maintenance insurance, etc.

Many thanks as always for your thoughts and feedback!

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Comments

  • We have a salary sacrifice scheme at work it's not good value cost wise.

    You'll find you can get a better price through a normal private lease. What I would say though is that it is convenient, ours includes insurance and servicing, also if you leave then the car gets handed back and you are not stuck with a lease that may no longer meet your needs.

    So it depends on how you consider value. Our scheme though seems really expensive Nissan Leaf N-Connector is about £360 a month 'net' cost. I saw a lease at £270 plus insurance etc. The lease worked out slightly cheaper monthly cost (including the higher first payment) but I was expecting salary sacrifice to be cheaper due to the tax saving. 

    You won't see anything near 200. They seem to double the lease cost and then you 'save' tax.
  • daveyjp
    daveyjp Posts: 12,385
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    £349 a month for a RHD car with LHD wipers, no thanks.
  • Mark_d
    Mark_d Posts: 283
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    £349 per month for a brand new car, within insurance and maintenance, doesn't sound ridiculous.  However personally I would buy a 5 year old Kia Soul EV. I think it works out much cheaper than leasing...especially if you've got a perfect car insurance track record.
  • We have a scheme though Tusker and those prices seem a fair bit cheaper than our ones!
    Our prices looked very much like the lease company effectively take all your tax savings and give you free insurance and maintenance, when compared to the best private leases I could find.
    Leasing though is not often the cheapest way to "own" a car Vs PCP or loan, however if you search for the best deals it can be, but these salary sacrifice schemes are often nowhere near to being close to the best deals. And generally they have a limited choice of in-stock deals.
    One thing to bear in mind is whether all your salary you are sacrificing is in the 40% bracket.
    I think they can kind of make sense if you are, but not if you are in or mostly in the 20% bracket.
    And from my perspective I would always be looking to put all of my 40% tax into a pension anyway, that makes the most sense to me!
  • By way of example, a Kona 48kwh on our scheme is £671 gross.
    You can lease that on same terms (ie a 1+47 at 5k a year) for £431.
    So basically £240 a month for insurance and maintenance.
    Via sacrifice if all at 40% it would cost about £425 a month net cost (though that does go up slightly each year as the BIK tax rate changes).
    So effectively you are just getting free insurance and maintenance versus just leasing privately.

  • Our scheme is also through Tusker and it is very hit and miss on pricing. The ID3 you mentioned is around the same price but an ID Buzz is £30 a month less! Both cars are showing over a year's lead time though.
  • I am sure I will be corrected if wrong -- but you may find salary sacrifice affects your pension (depending on which type of pension scheme you are in)
  • jimjames
    jimjames Posts: 17,494
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    If you want a car around the £200 mark have a look at the MG range. It probably won't be down as low as £200 but will be a lot closer than an ID3. Bear in mind how expensive these cars are new so even with the tax savings it's still a big chunk of money. Good for the government to help them meet their EV targets though.
    Remember the saying: if it looks too good to be true it almost certainly is.
  • Ibrahim5
    Ibrahim5 Posts: 995
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    My first car was £200. Very rusty and unreliable. Probably better to spend a bit more.
  • mroshaw
    mroshaw Posts: 47
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    Thank you so much everyone for the replies! It does seem like the scheme doesn't offer great savings, which is a shame. I'll definitely look at other options, including buying used.
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