How to Get a Company Car: A Guide for Directors, CXOs, and Employees
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Company cars should be easy to get. They should be accessible to more employees. And they should actually make financial sense.
And they can be if you go about it the right way.
In this guide, we break down how to get a company car today, from what qualifies to why salary sacrifice stands out.
What counts as a company car?
When people hear “company car”, they often picture something quite specific, like a perk reserved for directors, a branded vehicle, or a car you only use for work. In reality, it’s broader (and more relevant) than that.
A company car is a vehicle provided through your employer as a workplace benefit (rather than cash), which is why it’s usually taxed under company car / BIK rules.
What matters isn’t:
- whether the car has a logo on it
- how senior you are
- or whether you use it for work, personal driving, or both
What matters is that the car is treated as a workplace benefit.
That distinction is important because once a car is classed as a company car, different rules apply, particularly around tax. This is why company cars are often discussed alongside things like Benefit-in-Kind (BIK), payslips, and remuneration packages. It’s also why they can end up being far more cost-effective than arranging a car privately.
What does and doesn’t count as a company car
How to get a company car: Your options explained
As you saw in the table above, there are only a couple of ways a car is actually provided as a company car.
Some are legacy approaches that still exist today, others are newer models shaped by tax changes, employee expectations, and the shift to electric vehicles. Understanding the difference matters, because the route you take affects everything from cost to flexibility.
Traditional employer-provided company car
This is the classic setup. It’s where the business owns or leases a fleet of vehicles and allocates them to employees or directors who are eligible for one. The employer chooses the cars (often from a restricted list), sets the rules around use, and covers things like insurance, servicing, and maintenance.
From the driver’s point of view, it’s simple. You’re given a car, you can usually use it for personal driving, and it shows up as a taxable Benefit in Kind on your payslip.
From the employer’s side, though, this model comes with a fair amount of cost, administration, and risk, especially as fleets grow.
This is why traditional company cars have become less common outside of certain industries or senior leadership teams. Choice is limited, policies can feel rigid, and for a long time the tax treatment (particularly for petrol and diesel cars) made this option expensive for drivers as well.
That doesn’t mean it’s disappeared entirely, but it does explain why many businesses have moved away from this approach and started looking for more flexible ways to offer company cars.
Biggest pro: The cost of the car is usually covered by the company entirely.
Biggest con: Vehicle options are often limited. Both by the type available and who in the company they’re available to.
Salary sacrifice company car scheme
With a salary sacrifice company car scheme, the employer still provides the car as a benefit, and it’s still taxed as a Benefit in Kind. The difference is in how the cost is handled. Instead of the business running a fleet and assigning vehicles, employees give up a portion of their gross salary in exchange for access to a car.
This approach also flips the experience for the driver.
Rather than being handed a pre-selected vehicle, people usually get to choose the car that fits their lifestyle, whether that’s something compact for city driving or something more premium. Insurance, servicing, maintenance, and breakdown cover are typically bundled into one monthly cost, which makes budgeting simpler and removes a lot of the uncertainty that comes with running a car personally.
It also alleviates the majority of the administrative and financial burden from the employer.
Want to know more? Learn how salary sacrifice works.
Biggest pro: Access to a car that’s tax-efficient, flexible, and usually far better value than arranging a car privately.
Biggest con: It requires your employer to offer the scheme.
Why a salary sacrifice company car scheme is the best way to get a company car
Let’s look at all the ways salary sacrifice wins…for employees, employers, and if you go with an EV, for the planet, too.
It opens company cars up beyond seniority and status
For a long time, company cars were tied to hierarchy. You got one because of your title, not because it made financial or practical sense. That model quietly excluded a lot of people, even when a company car would have been genuinely useful for an employee. Or when it could have been used to attract and retain talent.
Salary sacrifice breaks the link between seniority and access. Instead of being reserved for a small group, company cars through salary sacrifice become a benefit people can opt in to based on eligibility and affordability, not job title.
It reduces the amount of tax you pay as an employee
Salary sacrifice shifts the cost of a company car out of your take-home pay and into a far more tax-efficient structure. You’re reducing your taxable income in exchange for a non-cash benefit.
Instead of being paid your full salary and then funding a car from what’s left, you agree to give up a portion of your gross pay in return for access to a company car. Because that reduction happens before Income Tax and National Insurance are calculated, the amount of tax you pay overall goes down. For electric vehicles, this is paired with low Benefit-in-Kind rates, which keeps the tax due on the car itself relatively small.
The impact of this depends on your tax band. The more tax you pay normally, the more powerful salary sacrifice becomes.
This is why salary sacrifice is often described as one of the most effective tax benefits for employees, particularly when it comes to electric vehicles.
This structure also works in the employer’s favour. Because gross salaries are lower, businesses pay less Employer National Insurance too. That’s one of the reasons electric salary sacrifice schemes are often cost-neutral to run, and sometimes even advantageous, especially when you look at the wider company tax benefits of electric cars.
The result is a rare alignment. Employees reduce the tax they pay. Employers reduce theirs. The car itself becomes significantly more affordable than it would be through most personal routes.
It gives people choice (which is why uptake is higher)
One of the unaddressed failures of traditional company cars was choice. Or rather, the lack of it. Cars were selected to fit policy, procurement, or resale value, not real lives. For a lot of people, that made the “benefit” feel like a compromise.
That’s not the case with salary sacrifice.
Instead of being handed a pre-approved vehicle, people typically get to choose the car they actually want to drive. That might mean something small and efficient, something family-friendly, or something more premium.
That sense of choice has a direct impact on uptake. When a company car feels imposed, people opt out. When it feels like a genuine option, with clear costs, clear tax treatment, and flexibility built in, people engage with it.
Choice also changes how the benefit is perceived internally. It stops being a symbol of hierarchy and starts feeling like a practical tool people can use differently depending on their circumstances. That’s a big part of why salary sacrifice schemes work across such a wide range of roles and salary levels.
It’s lower hassle and lower risk for the employer than it sounds
Salary sacrifice can look like a lot for an employer to take on. With cars, contracts, and payroll changes, it’s easy to assume it adds complexity. But, it usually does the opposite.
Unlike traditional company cars, salary sacrifice doesn’t require the business to own, manage, or maintain a fleet. There’s no need to handle insurance renewals, servicing schedules, or vehicle replacements. The scheme is structured so that most of the operational detail sits outside the business, while the employer’s role stays largely administrative.
Risk is often the next concern, particularly around what happens if an employee leaves.
Many providers now build protections in from the start to cover early exits and unexpected changes. For example, loveelectric’s Zero Risk Guarantee is designed to remove financial exposure for employers if an employee leaves the business, making it easier to offer the benefit with confidence.
Sold on salsac? Check out: How to Get a Car on Salary Sacrifice
How loveelectric makes getting a company car simple and tax-efficient
Salary sacrifice works best when it’s paired with an electric vehicle. That’s where the tax advantages are strongest.
Electric company cars attract significantly lower Benefit-in-Kind rates than petrol or diesel alternatives, and when combined with paying for the car from gross salary, the savings can be substantial. But while many providers now offer EV salary sacrifice, far fewer make it genuinely accessible.
loveelectric is built around the idea that electric company cars shouldn’t be limited to a narrow group of high earners or senior roles. Our focus is on making EV salary sacrifice work for more people, more realistically.
That shows up in a few key ways:
- Employees typically save 30–60% compared to personal leasing on an electric car, depending on salary and tax band - £280/month on average
- Low EV Benefit-in-Kind rates mean those savings aren’t clawed back elsewhere through tax
- All-inclusive monthly pricing covers insurance, servicing, maintenance, tyres, and breakdown, so costs are predictable from day one
- Access to both new and used electric cars, which lowers the barrier to entry and makes salary sacrifice viable even on more modest salaries
- Schemes designed to be offered across whole teams, not just to directors or senior leaders
- Minimal admin and no fleet management required from employers
- Built-in protections for common concerns, including loveelectric’s Zero Risk Guarantee if an employee leaves mid-agreement
- Optional deposits, so employees can lower monthly costs if they want to, without being forced into upfront payments
- A Charge Card that works across thousands of UK charging points, so drivers aren’t juggling apps, networks, or reimbursements
Ready to see if a loveelectric company car could work for you? You have a few options depending on your role at your company:
- Check your eligibility to see whether you can get an electric company car through salary sacrifice.
- Refer your employer if your company doesn’t yet offer the scheme.
- Browse the range of electric cars available through Loveelectric, including new and used options.
- Book a demo and see how it all works.
Company car FAQs
What is a company car scheme?
A company car scheme is the framework an employer uses to provide vehicles to employees and directors. Historically, this meant a fleet of employer-owned cars.
Today, most company car schemes, particularly for electric vehicles, operate via salary sacrifice, which has largely replaced traditional company car models due to lower tax, reduced risk, and simpler administration.
How do company cars work?
Company cars work by treating a vehicle as part of your overall pay package rather than something you buy or lease privately.
Instead of paying for the car entirely from your net salary, the employer plays a formal role in providing it. Here’s the simplified version:
- For salary sacrifice: the employer technically leases the car and provides access to the employee, reimbursing the cost via payroll
- You’re allowed to use it for work (often as well as personal driving)
- HMRC assigns a taxable value to that benefit
- You pay tax on that value, rather than on the full cost of the car
How much tax you pay depends on a few factors, but the big ones are:
- the type of car (electric vs petrol or diesel)
- its list price
- and your personal tax band
How do company cars for employees differ from a car allowance?
With a car allowance, employees receive extra taxable income and arrange their own car. With company cars for employees, the employer facilitates the vehicle through a scheme, usually salary sacrifice, meaning:
- Lower tax and National Insurance
- Predictable monthly costs
- Fewer admin and ownership headaches
For EVs, salary sacrifice is typically the more cost-effective option.
Are company cars for directors taxed differently?
The tax rules are the same, but the impact is different. Because directors are often higher-rate or additional-rate taxpayers, the Income Tax and National Insurance savings from salary sacrifice are usually much greater.
This makes electric company cars particularly attractive for directors, thanks to low Benefit-in-Kind (BIK) rates.
Can a small business offer company cars for employees and directors?
Yes. Company size doesn’t prevent you from offering company cars for employees or directors. As long as the business meets eligibility criteria, even small and growing companies can run a salary sacrifice company car scheme.
Modern schemes are designed to be cost-neutral for employers and light on admin.
Is a salary sacrifice company car scheme worth it?
For most people, yes, especially for EVs. EV salary sacrifice company car schemes typically offer:
- 30–60% savings versus personal leasing
- Lower tax through BIK
- Fewer running cost surprises
The biggest savings are usually seen by higher-rate taxpayers like CXOs, directors, or senior specialists. Read more in our article: Is EV Salary Sacrifice Worth It? Car Scheme Pros and Cons
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