The salary sacrifice car scheme offered by Pink Salary Exchange offers great benefits for both the employee and the employer. This is an HMRC-approved scheme which has been designed with the input of tax and insurance specialists and which ensures compliance in terms of GDPR. But in a financial sense, what benefits can the business expect?
Pink Salary Exchange offer a scheme which can lead to significant cost savings for the business, and which can help to streamline operations and procedures in a more efficient way. Here we will look at some of these areas and why signing up for the Pink Salary Exchange salary sacrifice car scheme makes good financial sense.
Fleet Costs
Managing grey fleet – ie. vehicles which are used on company business but are not owned by the company – is the responsibility of the business. Any lease vehicles taken on by employees become grey fleet, and hence the business needs to monitor mileage, route planning, job planning and driver behaviour. This can all lead to efficiency savings in terms of cutting out wasted journeys and costly driving practices.
It is also possible for the business to take advantage of ‘batch lease deals’. Pink Salary Exchange partner with Pink Car Leasing in sourcing electric vehicles (EVs), and if a group of vehicles are leased together it is possible for discounts to be offered to suit the business and the employee. Because Pink Car Leasing enjoys good relationships with the best vehicle manufacturers they always offer the best lease deals available, and so EV leasing becomes particularly cost-effective.
Lower national insurance contributions
A salary sacrifice car scheme which involves EVs and plug-in hybrid vehicles allows the employee to take their salary hit on the gross salary. This provides a real cash benefit in terms of reduced tax and national insurance payments. The business, in turn, also has lower national insurance payments to make for each qualifying employee. On a monthly basis this can be a significant cost saving across the business.
Compliance and safety
The administration of a salary sacrifice car scheme assists the business with various compliance issues, particularly with GDPR, vehicle insurance, service and maintenance, licensing and MOTs. This helps in terms of a management cost, but also it helps the business to avoid fines for non-compliance. Ultimately, a better management of service and maintenance can also lead to a reduction in accidents and absenteeism, which is another cost saving for the business.
Retention tool
A key benefit of a salary sacrifice car scheme for the business is in it helping to attract and retain the best employees. A scheme such as this is a considerable perk for an employee and is something the business can promote to improve its PR image. In practice, the scheme can also act to boost morale and productivity within the workforce. This has obvious cost benefits, but retaining key employees also has the knock-on effect of reducing recruitment costs. The human resources costs of recruitment are not inconsiderable. You have job advertising, the selection and interview process and then the training and induction process. This can tie up resources at a critical time, and is a cost which can be avoided by having a progressive and inclusive culture which encourages employee loyalty and retention and reduces staff turnover.
In terms of human resources costs, the Pink Salary Exchange scheme also comes with template documents already set-up which the business can use to educate employees on the fundamentals and processes within the scheme, so there is no additional cost in briefing employees and helping them understand the product, all those free resources are already in place and available.
You can speak with Pink Salary Exchange to understand the process of the business getting involved in the salary sacrifice car scheme and what employee rollout involves, so contact our team today