Salary Sacrifice EV Full Model Calculator 2026/27
EV salary sacrifice 2026/27 modelled in full: lease cost, Income Tax and NI saved, 4% company car tax and the employer's NI position.
The full economics of EV salary sacrifice: the lease cost, the Income Tax and NI you save on the salary given up, and the company car tax at 4% of list price.
Three illustrative cases (2026/27)
List prices and lease costs are assumptions for the example, not provider quotes. Income Tax at rest-of-UK rates (higher rate above £50,270); employee NI 8% in the main band and 2% above the Upper Earnings Limit. Scottish taxpayers save at Scottish rates. Each case assumes the whole sacrifice falls in one band.
| Case | List price | Annual lease | Tax + NI saved | BIK Income Tax | Your net annual cost |
|---|---|---|---|---|---|
| Basic-rate taxpayer | £35,000 | £5,040 | £1,411 | £280 | £3,909 |
| Higher-rate taxpayer | £45,000 | £6,600 | £2,772 | £720 | £4,548 |
| Additional-rate taxpayer | £55,000 | £8,160 | £3,835 | £990 | £5,315 |
The employer's side
The employer stops paying 15% secondary Class 1 NI on the salary given up, but pays Class 1A NI at 15% on the car benefit. In the higher-rate case above that is £990 saved against £270 of Class 1A. Whether any of the saving is passed on to you is the employer's choice.
Frequently asked questions
How does EV salary sacrifice work?
Your employer leases the car and you give up the same amount of salary under a contract change. You save Income Tax and employee NI on the salary given up, then pay Income Tax on the company car benefit, which for a zero-emission car in 2026/27 is 4% of the list price. For cars with CO2 emissions of no more than 75g/km the benefit is always valued under the normal company car rules, not by the salary given up.
What is the electric-car benefit-in-kind rate for 2026/27?
4% of the list price for a zero-emission car in 2026/27, rising to 5% in 2027/28. HMRC's Autumn Budget 2024 policy paper adds 2 percentage points a year after that, to 7% in 2028/29 and 9% in 2029/30. The highest-emission cars are taxed at 37%.
How much does an EV salary sacrifice save against a personal lease?
It depends on your marginal Income Tax and NI rates, the lease cost and the list price of the car. The table on this page works three illustrative cases from the current rates; use your own lease quote and list price for a real comparison.
Is workplace charging of an electric car taxable?
No Income Tax arises on facilities for charging a vehicle battery provided at or near the workplace, under section 237A of the Income Tax (Earnings and Pensions) Act 2003.
What mileage rate applies to business miles in an electric car?
In your own car, the tax-free Approved Mileage Allowance Payment is 55p a mile for the first 10,000 business miles and 25p after that, whatever the fuel. In a fully electric company car, HMRC's advisory electricity rate from 1 September 2026 is 7p a mile for home charging and 15p for public charging.