Salary sacrifice company car schemes overwhelmingly favour those with lower salaries

Our recent research has shown that salary sacrifice schemes, including car benefit schemes, are utilised hugely by those in the 20% tax bracket, dispelling the myth that salary sacrifice for cars are reserved for more senior employees.


Nationally, 82% of UK taxpayers are in the 20% bracket. 88% of our drivers are in this lower tax bracket, with 56% are earning less than £30,000. A whole new demographic are able to enjoy the benefits of the company car thanks to salary sacrifice.

The benefits of salary sacrifice

These car schemes help employees who rely on driving to work, move into brand new, safer, and more efficient cars. As long as the contribution towards the car doesn’t take them below National Living Wage, any employee, regardless of their position in the company, is able to take advantage of the benefit of a new car through the scheme. This enables more people than ever to afford a brand new car, where otherwise they may not be able to.

One driver, Jill, is an NHS District Nurse. Thanks to the scheme provided by her employer, Jill has been able to get rid of her eight-year-old second hand car and is now driving a new, reliable and more efficient Nissan Juke, which she uses daily to complete her house calls.

Regular trips to the garage for repairs have disappeared – and so has that cost. Without the scheme it’s unlikely that Jill would have been able to afford a new car and so would have probably remained in her older, unreliable second hand car.

Aiding staff retention and satisfaction

With this in mind, it’s perhaps unsurprising that benefits packages from employers help employees feel more valued, which aids staff retention, engagement and overall satisfaction. The whole motoring package includes corporate discounts which would be almost impossible for any individual to achieve, and it’s this that enables employees to make their pay packets stretch that much further.

“Much has been written on salary sacrifice schemes recently suggesting take-up is greatest for higher salaries," says Paul Gilshan, chief marketing officer at Tusker. "However, it's the opposite. Real driver data shows that such schemes open up the company car market for those on lower salaries and are helping more people into cars they would not have been able to afford otherwise. Drivers are getting to work in safer, cleaner, lower emitting and reliable cars.”

This article was provided by Tusker.

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