Fleet News

Salary sacrifice opens the door to company cars

Aston University has bolstered its employee benefits scheme by launching a car salary sacrifice scheme alongside the more traditional offerings of bicycles and pension contributions.

The scheme, which is provided by Tusker, allows employees to surrender up to 20% of their salary in return for a new car for up to three years.

As well as setting a financial limit, the University has also set a carbon cap on the new arrangement, allowing more than 1,200 employees to select vehicles only from a range of 600 models with emissions of 120g/km or less.

University vice-chancellor Professor Julia King, who was appointed the UK’s Low Carbon Business Ambassador by the Prime Minister in November 2010 and is author of the 2007 King Review on green vehicle and fuel technologies, has given the scheme her backing because of its credentials in promoting green, low emitting vehicles.

“The new scheme is one of a number of initiatives we have embarked on to encourage the uptake of green practices within the university,” said Cliff Vidgeon, director of human resources at Aston.

It launched the new scheme to university staff at a special employee benefits exhibition, where 10% of staff registered an interest in taking part in the scheme.

“There was a very positive reaction among university staff at the benefits exhibition to the new car scheme, including our vice-chancellor, who thought it a very suitable scheme for promoting the uptake of greener cars,” added Vidgeon.

Aston staff will benefit from lower income tax and national insurance contributions as a result of selecting a new car under the scheme, although they do have to pay benefit-in-kind tax on the value of the benefit, albeit at a lower rate than income tax and NIC combined.

Tusker currently has more than 30 live salary sacrifice car schemes covering more than 400,000 employees.

Analysis has shown that employees who select new cars under its Salary Sacrifice4Cars scheme (SS4C) typically select models with average emissions of 30-40g/km less than their previous vehicle.

For example, Tusker conducted a survey earlier this year which showed salary sacrifice drivers had selected cars with an average CO2 of 119.6g/km, compared to those on Tusker’s contract hire fleet who had chosen vehicles with an average 149.5g/km.

“We are now seeing a definite trend amongst employees on a salary sacrifice car schemes to select greener, cleaner, less polluting cars,” said Tusker managing director David Hosking.

NHS procurement platform offers salary sacrifice scheme

Leeds Partnerships NHS Foundation Trust is giving its staff access to a company vehicle for the first time thanks to a recently launched salary sacrifice scheme.

It is one part of a much wider vehicle offering being managed by Tusker called CPC Drive, which is an element of NHS CPC, the Yorkshire and Humber NHS procurement organisation working alongside NHS operations across the country.

NHS CPC Drive communicates the new service to Trusts via a series of media channels, including a regular magazine, emails and networking groups for members. It is accessed online via www.cpcdrive.nhs.uk

Sue Rodriguez, lease car manager at Leeds PFT, told Fleet News the scheme had achieved more than 50% of the annual anticipated number of orders in just a few weeks of going live.

“Staff were surprised how attractive the scheme is,” she said. “The car comes with full maintenance,
servicing and tyres and the price includes motor insurance and road tax, too. Combine this with the public sector purchasing power and discounts, and it makes it real value for money.

“When they also took into account the amount of income tax and national
insurance they saved on the salary they surrendered, staff really appreciated how cost effective it was.”

There is a CO2 cap of 150g/km for all new vehicles, and the current average is approximately 122g/km.

“We tend to find that staff opt for bigger cars if they are older and have families with young children – the Nissan Qashqai is a very popular car with us – while younger, single staff are selecting vehicles like the Fiat 500, Citroën C1, and Mini.

The salary sacrifice scheme is delivered through Tusker’s SS4C electronic platform, which Rodriguez says staff find very easy to use and simple to operate.

“Once we have a signed contract with the driver, we then send the order off to Tusker to fulfil.

"So far we have ordered 70 new cars through the scheme, all on three year contracts with individual mileages and it is working very well,” she said.



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