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Salary sacrifice prices
- Thread starter Basicbob
- Start date
As someone said on the last page, it is impossible to compare the net prices being posted here because there will be a mix of people paying 20/40/45/60% marginal tax rates. Best to post gross figures.
My gross payment for a 2021 M3 LR 3yr/60k lease including insurance and tyres etc is £832. I need to hand the car back in September so starting to think about my options. The easiest/sensible thing to do is go for another M3 LR (in the new red - love it!) assuming the price is right.
Salsac is extremely attractive for some due to the very high marginal rates at certain income levels. The 62% marginal rate on earnings between 100-125k artificially caps my gross pay at 100k - everything above that is sacrificed into my pension and pays for the car. If I wasn’t salsacing for the car, I would just be putting more into my pension and my motoring costs would be eating into my sub 100k post tax income.
One thing to bear in mind is that BIK rates start to tick up in April 25 and will rise 1% a year until 2028. The absolute sweet spot is to fiddle your pension contributions so that after the car salsac your taxable income (including the BIK) is exactly 100k. This means you save 62% on all of the lease cost and pay only 40k on the BIK.
My gross payment for a 2021 M3 LR 3yr/60k lease including insurance and tyres etc is £832. I need to hand the car back in September so starting to think about my options. The easiest/sensible thing to do is go for another M3 LR (in the new red - love it!) assuming the price is right.
Salsac is extremely attractive for some due to the very high marginal rates at certain income levels. The 62% marginal rate on earnings between 100-125k artificially caps my gross pay at 100k - everything above that is sacrificed into my pension and pays for the car. If I wasn’t salsacing for the car, I would just be putting more into my pension and my motoring costs would be eating into my sub 100k post tax income.
One thing to bear in mind is that BIK rates start to tick up in April 25 and will rise 1% a year until 2028. The absolute sweet spot is to fiddle your pension contributions so that after the car salsac your taxable income (including the BIK) is exactly 100k. This means you save 62% on all of the lease cost and pay only 40k on the BIK.
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Yeah I agree with previous posters, gross figures are the best things to state. Can anyone beat the eye watering gross figure I pay for MYP + EAP 3 yr from Arval (10k miles / year) = £1385 / month. Includes insurance / tyres / maintenance (wot maintenance?!). Not sure I can burn through enough tyres to make it better value.
Gross figures are no more accurate than net, too many variables per person:
-age
-location
-lease company
The only real way to get an indication is to go and obtain quotes for other types of vehicle within your fleet scheme.
Net figures have all of that variation, plus individual tax variation - therefore they can only be less accurate.
Bantam
Member
If Salary Sacrifice is your preferred way forward and you are flexible in your choice of car/colour/delivery date, I have found keeping an eye on the In stock/Coming soon page, if you time it right you can get some great discounts (unfortunately I have never found a Tesla on the list). My personal lease Model 3 is going back soon, I have ended up ordering a XC40 recharge ultimate from the coming soon list for £110 less on the net amount than if I spec'd it up and ordered from scratch.
It doesn't matter, neither are relevant figures for suitable for person to person comparison, due to variations in age/location/lease companies.
It’s very difficult because insurance is bundled in which is a postcode lottery plus occupation, mileage, business mileage, points on license etc that could alter the monthly cost by £150 between people. Then is a home charger included, does your company include early termination protection, yearly mileage, length of lease term, size of company/volume discount and probably a few more variables.
WannabeOwner
Well-Known Member
Maybe a better comparison is difference between Salary Sacrifice vs. best finance deal available (for same individual, and car model etc., finance-period)
MrBadger
Badger out
Sounds like this may be turning into a pissing contest a bit like the Wh/mile one has.
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