Could you explain all that in layperson’s terms. It looks quite interesting! Where are you in the GT Line Waitlist?
If your employer allows, you can deduct the cost of the monthly Evezy subscription from your gross salary.
This means that say you’re £24k or £2k per month gross. You would pay monthly tax of £192 (20%), NI of £154 (12%), auto enrolment pension of circa £60 (4%), in my case student loan deduction of £35 (9%). This means net pay monthly of £1,561 less £419 to Evezy meaning you are left with £1,142.
If you took the car out of your gross salary, then in my made up example above , your gross pay would actually be £1,581, you are then taxed on this amount as above, I won’t put the numbers here but at the end of the month you will have net pay of £1,327.
This is £185 better off, which is based on the £419pm subscription a saving of 44% (in my made up example I go below student loan threshold using salary sacrifice otherwise saving is 45%. For most people the saving is at least 32% and 36% if you pay auto enrolment pension (this may not be classed as an actual saving because you’re not paying into your pension and benefitting from the government topping you up).
Now, the government do tax salary sacrifice for cars with Benefit in Kind Taxes but for EVs this is 0%/1%/2% for the next 3 tax years. When it goes to 2% in 22/23 the monthly amount you are taxed on is £55 (£55x20% for basic rate payers so £11) based on the GT line’s P11d value of £32,815.
Of course there’s a budget soon and we need to see if this stays the same.
Please also note the above does not constitute professional advice, it’s always worth speaking to an accountant. The info is all freely available online:
The complete guide to company electric car tax, covering what a company and employee need to contribute and how it is calculated.
pod-point.com
To note that not all employers will offer this. If they don’t, there’s no harm in asking as the employer also saves 12% National Insurance contributions too although once the BIK rate goes up the company pays 13.8% P11d tax (Class 1A NICs) but only on the BIK value which in my example for 22/23 is £55pm or £660 x 13.8% so £91 basically peanuts!
I understand that’s a lot but look into it and feel free to ask questions on it and I’ll try answer in evenings.
PS I’m in top 100 is all I’ll say.
