What is The Electric Car Scheme?
The Electric Car Scheme (ECS) is a UK-based salary sacrifice scheme for EV leasing. Offer your employees an electric car with no additional cost to your business. Here’s how it works:
- The employer leases an electric car
- The employee gets the car as a benefit
- The lease sum is deducted from the employee’s gross salary, meaning they pay less income tax and National Insurance
- The car benefit is taxed, but only very lightly
Savings through salary sacrifice
A salary sacrifice scheme deducts the monthly lease cost for the EV from the pre-tax wages. Compared to leasing the car with after-tax income, these savings can add up to thousands of pounds throughout the lease term. Employees have to pay a benefit-in-kind tax for the car. However, this is set very low electric vehicles.
Here’s an example calculation of how much leasing through ECS could help your employees save each month.
The prices above are indicative only. The best deals on the market change daily.
The right car for the best price available
The Electric Car Scheme helps you and your teammates find the right electric vehicle for them, at the best price available at their leasing partners.
ECS compares top leasing companies to find the best prices for the duration of the lease. The options include 2—4-year leases for new cars plus shorter leases for used EVs. Especially the ability to lease used electric cars helps make EVs more accessible for lower-rate tax-payers too.
No risk, no surprises
The Electric Car Scheme makes offering an EV benefit a no-brainer for employers. The fee to employers is equivalent to the tax savings gained, making it a potentially net zero-cost scheme.
Leasing through ECS gives employers peace of mind, paying for unexpected costs if the car needs to be returned early, and protecting employees for most potential early termination reasons. Whereas early termination fees could go as high as half of the remaining lease payments, with ECS employers never have to worry about any fees for charges outside of their control.
In addition to the car itself, the electric car scheme offers an all-inclusive package with car insurance, servicing, and EV charging.
Convenient public charging for your leased EV
When you lease a car through The Electric Car Scheme, your employee gets a charge card and app, powered by Plugsurfing. These enable access to one of the biggest charging networks in the UK and EU alike, with more than 850,000 charge points throughout Europe.
What’s more, EV charging expenses may be eligible for salary sacrifice. As a result, the employee ultimately pays only the benefit-in-kind rate for the charging sessions, making the price of public charging considerably more attractive.
The employee pays for charging when the charging session takes place. At the end of the month, ECS automatically gathers the monthly EV charging spending into a single report and files it as personal expenses for the payroll, lowering the employee’s taxable salary.
Why is The Electric Car Scheme such a game changer?
Driving an EV is always more efficient than a traditional petrol or diesel car. To speed up the switch to electric cars, the UK government has created strong tax incentives for employees. In October 2024, the Chancellor of the Exchequer confirmed the government commitment to keeping the benefit-in-kind tax rate low. This means that salary sacrifice remains the best and most cost-effective way to get into an electric car.
Unfortunately, government EV incentives are not always easy to access for companies employing fewer than a thousand people. However, 61 percent of the UK employees work for small or medium-sized businesses, employing under 250 people.
This is where The Electric Car Scheme steps in. With a 360-degree salary sacrifice solution suitable for also small companies, their employees can enjoy the same tax savings and access to electric cars as people working for the biggest firms in the UK.
So help your workmates make the obvious sustainable choice and offer them an EV benefit through The Electric Car Scheme. Get in touch with the ECS team to book a demo, and be the hero for your team.
