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Interactive tool · FY2026/27

Electric Car Salary Sacrifice Calculator

See what an EV salary sacrifice scheme could actually save you, using published 2026/27 HMRC income tax, National Insurance and Benefit in Kind rates. Enter your salary and a lease quote below.

Step 1

Your details

Tell us your gross salary and the car scheme quote, and we'll work out the real cost after tax and National Insurance.

Your salary

Before any deductions — the figure on your contract or payslip before tax and NI.
National Insurance is the same UK-wide; only income tax bands differ in Scotland.

Car scheme details

The gross amount you give up each year — usually quoted per month by the scheme provider.
Used to work out the taxable Benefit in Kind (BIK).
1–50g/km bands per HMRC's 480: Appendix 2 (2026/27). Petrol and diesel cars are taxed on a CO2-based sliding scale from 18% up to a 37% cap — enter the exact rate for your vehicle as "Custom".
Company car Benefit in Kind is taxed as income (added to your taxable pay) but is not subject to employee National Insurance — only the employer pays Class 1A NI on it. This is why electric vehicles, with a low BIK rate, are the most tax-efficient salary sacrifice option.
Step 2

Your result

Comparing salary sacrifice against funding the same car privately, out of your take-home pay.

Gross cost of the car
£0
per year, sacrificed from salary
Tax + NI saved (net of BIK tax)
£0
per year
Effective net cost of the car
£0
£0 / month
Without the scheme (funding a car privately, from net pay)£0 gross
With salary sacrifice car scheme£0 gross
Take-home pay Income tax Employee NI Extra tax on BIK Car sacrificed
Per yearWithout schemeWith schemeDifference
Employer view: they save Class 1 NI (15% above the £5,000 secondary threshold) on the sacrificed amount, but pay Class 1A NI (15%) on the BIK value. Net employer NI change: £0 per year.

Want an exact quote on a real vehicle?

This calculator is illustrative. VCEA's consultants can give you a fixed monthly price and confirm the exact BIK rate for the car you have in mind.

Get a Quote
How it works

What the calculator does

This tool compares two scenarios side by side — funding a car out of your take-home pay versus using a salary sacrifice arrangement — using published 2026/27 HMRC rates throughout.

01

Enter your gross salary and tax region

Your gross salary determines your income tax band and National Insurance rate. Scotland uses different income tax bands from the rest of the UK, so the calculator adjusts automatically based on where you pay tax.

02

Enter the car scheme details

The gross sacrifice amount is what you give up from your salary before tax — usually shown as a monthly figure by the scheme provider. The P11D value is the manufacturer's list price of the vehicle, used to calculate your Benefit in Kind liability.

03

See your real net cost

The calculator works out your income tax and National Insurance in both scenarios, adds back the BiK tax cost, and shows you the genuine net difference — what the car actually costs you after all tax effects are accounted for.

Reading your results

What each figure means

The three headline figures at the top of the results section each tell you something specific about the financial impact of the scheme.

Gross cost of the car

This is the full annual salary sacrifice amount — the figure that comes out of your gross pay before tax. It is the headline price of the scheme, but not what the car actually costs you in real terms, because you have not paid income tax or NI on that money.

Tax and NI saved (net of BiK)

This is the true financial benefit of the arrangement. It is your combined income tax and National Insurance saving on the sacrificed amount, minus the extra income tax you pay on the Benefit in Kind value of the vehicle. This is the amount the scheme puts back in your pocket compared to funding the car privately.

Effective net cost

This is the real monthly cost of having the car through salary sacrifice — the gross sacrifice minus your tax and NI savings, plus your BiK tax. It is the most useful figure for comparing salary sacrifice against a personal lease on the same vehicle.

Worked examples

Typical savings at different salary levels

The examples below are based on a fully electric vehicle with a P11D value of £35,000, a gross sacrifice of £4,800 per year (£400 per month), and the 2026/27 EV BiK rate of 4%. Figures are illustrative — use the calculator above for your exact position.

Scenario Gross salary Tax region Gross sacrifice (annual) BiK tax cost (annual) Net saving (annual) Net saving (monthly) Effective monthly cost
Basic rate taxpayer £35,000 England / Wales £4,800 £280 £1,064 £89 £311 / month
Higher rate taxpayer £65,000 England / Wales £4,800 £560 £1,616 £135 £265 / month
Scottish basic rate £35,000 Scotland £4,800 £280 £1,096 £91 £309 / month
Scottish higher rate £65,000 Scotland £4,800 £560 £1,784 £149 £251 / month

Based on: P11D £35,000, gross sacrifice £4,800 per year, EV BiK rate 4% (2026/27), Personal Allowance £12,570, standard tax codes. Scottish income tax uses 2026/27 bands. Employee NI at 8% below UEL, 2% above. Figures are illustrative only — confirm your exact position with VCEA or your accountant.

Questions

Salary sacrifice calculator — frequently asked questions

Answers to the most common questions about how salary sacrifice savings are calculated and what affects the result.

A basic-rate taxpayer (20% income tax) saves 20% tax plus 8% employee National Insurance on the sacrificed amount — a 28% combined saving before BiK tax. A higher-rate taxpayer saves 40% tax plus 2% NI — a 42% combined saving. At the 2026/27 EV BiK rate of 4%, a basic-rate taxpayer sacrificing £400 per month typically saves around £89 per month net on a £35,000 P11D vehicle. A higher-rate taxpayer typically saves around £135 per month net on the same car. Scottish taxpayers may save slightly more due to the intermediate tax bands.
Any UK employer can offer salary sacrifice car schemes to their employees, provided the employee's post-sacrifice salary does not fall below the National Minimum Wage or National Living Wage. There is no minimum company size — schemes work for businesses with as few as one employee. The employee must be a PAYE worker. Self-employed individuals and sole traders cannot use salary sacrifice. Employees on fixed-term contracts may be eligible, but the contract length needs to match or exceed the lease term.
Benefit in Kind (BiK) tax applies when an employer provides a car available for private use. It is calculated by multiplying the vehicle's P11D list price by the BiK percentage rate, then applying the employee's income tax rate. For a fully electric car with a P11D value of £35,000 at the 2026/27 BiK rate of 4%, the annual BiK value is £1,400. A basic-rate taxpayer pays £280 per year (approximately £23 per month) in BiK tax. The calculator deducts this BiK tax cost from the gross tax and NI saving to show you the genuine net benefit of the arrangement.
It can do. Because salary sacrifice reduces your gross pay, pension contributions calculated as a percentage of salary may also reduce — both yours and your employer's. However, many employers use a reference salary (your pre-sacrifice salary) to calculate pension contributions, which avoids this issue. If your pension is defined contribution, the impact depends on your scheme rules. You should check your employment contract and pension scheme terms before entering a salary sacrifice arrangement. VCEA can provide guidance on this as part of our scheme setup process.
Yes. Employers save Class 1 National Insurance (15% in 2026/27) on the portion of salary that is sacrificed, because they no longer pay NI on that amount. However, employers must pay Class 1A NI (also 15%) on the Benefit in Kind value of the vehicle. For a fully electric car, the BiK value is low — 4% of P11D in 2026/27 — so the Class 1A cost is typically much less than the Class 1 saving. The net result is a genuine NI saving for the employer. The calculator shows this figure in the employer note below your results.