With so many providers offering salary sacrifice schemes and using different pricing models, it can be challenging to understand where the best value for money is or what exactly you’re paying for.
The main issues you might face when trying to find out the price of a salary sacrifice scheme are:
- Hidden costs that aren’t included in the website
- Having to get on a sales call to find out how much you’ll be paying
- Not knowing exactly what’s included
- Being unsure of how the company makes money
In this article, we’ll give a rundown of loveelectric’s pricing so you know exactly what you get for your money. We’ll do this by discussing:
- How loveelectric charges for its service
- What’s included in your monthly lease
- How loveelectric compares to the other salary sacrifice scheme providers
- What should you keep in mind when choosing a salary sacrifice scheme service?
Note: if you’re looking to get started now, choose your brand new electric car and get a sample quote instantly by sending an enquiry.
How we charge for our service
loveelectric is free to set up. As an employer, you won’t have to pay anything to set up the salary sacrifice scheme.
We only charge a fee once an employee’s car is delivered. We charge a small administration fee, which is 3% of the employee's gross rental and averages out at around £20 per month per car. The fee is taken from the employer’s NIC savings, which means that loveelectric’s service fee is essentially cost-neutral to the company.
So how do we make money? At loveelectric, we charge our commission based on 2% of the P11D value of a car. We factor this percentage into our online prices, so there aren’t any nasty surprises after you sign up.
For example, with the Fiat 500, the total net fee that the employee would pay if they had a £60k salary would be £8.13 per month (£292.68 over the lifecycle of the lease), which is 1.2% of the P11D value of the car. This would be taken out of the NIC savings made by their employer, meaning the employee pays £7.67 per month out of their NIC savings.
Most salary sacrifice providers are free to set up, but will then charge artificially inflated monthly leases to employees to cover their costs. With loveelectric, you’ll know you’re getting the best value for money as well as how our business works.
How loveelectric presents its prices for full transparency
The gross cost is the amount shown on our web application, which is deducted from the customers' salary before tax. This is a fixed amount with no other deposit, sign-up fee or hidden costs added throughout the lease.
The net cost is the actual cost to the driver that they pay via a reduced salary. Salary sacrifice works by taking the cost of the lease out of the employee’s gross amount and reducing their yearly tax.
Once the employer has signed up and employees have access to the driver’s portal, they’ll be able to see more accurate pricing for the monthly leasing cost.. They’ll be able to input their postcode, age and salary, which will dynamically change the lease based on their specific circumstances.
The tax reduction is based on the driver’s salary and postcode. In most cases, the higher your salary, the higher the percentage of savings you will make.
The infographic below shows an example of the pricing and how the savings would look on an employee’s payslip. For a more comprehensive look, check out this article on Salary sacrifice electric car examples: how it works in practice.
What's included in your monthly lease with loveelectric?
When you sign up for loveelectric, you will have a fixed-term monthly lease contract with a full breakdown of all the costs beforehand.
Here’s what’s included:
Access to any electric car you want via 300+ car dealerships
We’ve partnered with over 300 dealerships around the UK, which means you’ll have access to a wide range of cars from a very affordable Fiat to a top-of-the-range Porsche.
All the cars you see on our app are brand new. Once your lease term is over, you can exchange the car for another brand new one to stay on top of EV technology.
You can choose a lease term from 2 to 3 years and also adjust your annual mileage allowance which can range from 5,000 - 30,000 miles. You have the option to add fully comprehensive insurance so that you won’t have to get it yourself.
Access to the best prices
We’re a broker, not a leasing company, which means that we’re able to offer customers the best prices on the market. We partner with large leasing companies and can negotiate further discounts on our listed prices which wouldn’t be possible if we were a leasing company. This ensures we’ve almost always got the lowest price on the market.
Other salary sacrifice providers are often car leasing companies, which means they may not have as wide a selection of cars available and the lead times might also be longer.
Everything you need to keep your car running
By signing up to loveelectric you’ll also have access to everything else that comes with a lease, including maintenance and servicing. With loveelectric, you specifically get:
- Maintenance and servicing
- Breakdown assistance and recovery
- Replacement tyres and glass
- Accident management
You’ll also get a driver handbook, where you’ll find everything in more detail.
Having your maintenance and servicing paid for helps ensure that you don’t have to worry about anything when driving your car. In turn, we’re there for you if you need breakdown assistance, so you’re never stranded.
An example of the breakdown of the costs for loveelectric’s services is illustrated below.
Early termination protection that covers both employees and employers
What happens if an employee resigns? Or is made redundant?
That’s where our early termination protection comes in.
Our protection is included in all monthly leases and is automatically included in the final price you’ll see. If an employee resigns after 3 months, they only need to pay a one-off fee equal to one month’s pay of the gross lease. If an employer makes an employee redundant after 6 months, they will pay a one-off fee worth one month of the gross lease payment.
Our early termination protection is one of the most comprehensive and will ensure employees and employers are protected.
Two things to note about an employee leaving their company while on our scheme:
- The employee can novate the contract to another eligible employee in the company. This is great as there is no fee, and the next employee has no lead time for their new car. The car could also be used to help recruit a new employee.
- Our loveelectric support team can help the departing employee move the lease to their new employer at no extra charge. We can also offer it to another company within our customer base (both options with Plus package only).
You can also read more details here: Early Termination Protection for Salary Sacrifice Car Scheme: How It Works And What You Need to Know
Fully comprehensive car insurance for worry-free driving
As specialists in salary sacrifice scheme leasing, it’s only fitting that we got similar specialist insurers to cover our cars.
Lloyds Latchford Group matches our strict criteria for excellence and has a solid track record covering over 700 car fleets in the UK. They’ve been in the salary sacrifice industry since 2007, and have extensive experience with car leasing.
The insurance cost is fixed throughout the lease, helping provide cost stability. Since the insurance is already built into the price, it also benefits from the tax savings employees get.
One highlight of our insurance is that we have gap insurance included in our policy. If a car gets written off after an accident, the insurer may pay a price which is different from the valuation of the leasing company. Our gap insurance protects the employer from having to pay this difference.
Most importantly, you can rest assured that you and the vehicle are fully covered for accidental damage and personal liability. In the case of an accident, we also cover the cost of taking the car to the nearest repairer and delivering it back to you.
Customer service experts supporting you from start to finish
We have a dedicated team to help make the entire salary sacrifice scheme process as seamless as possible. If this is your first time setting up or using a salary sacrifice scheme, you might have many questions. We’ll be at hand to offer support and answer any questions you might still have about our service.
We also have a public community where you might find the answers to your questions already answered. Our expert advisor checks this regularly, and we like keeping it transparent for anyone to see.
For companies interested in signing up but still have questions, we offer a webinar solely for educational purposes. We have found these group webinars with a group of employees help clear up many blind spots about salary sacrifice.
We offer support with your HMRC needs and will provide the templates and documents needed to get your tax affairs in order. Your accountants will then have everything they need to ensure all your books are up to date.
When an employee signs up for a salary sacrifice scheme, it’s technically a minor change in their employment contract. Therefore, we provide the appropriate contract amendment for the employee, creating less work for the employer's HR team.
User-friendly web application to browse our large selection of cars
In our app, employees will be able to input their details and contract specifications to suit their needs and get access to live dynamic prices.
In our private app, employees can change their details and modify the car trim before ordering. You do not need to do a consultation call with us to get a quote. A sample of the private app is shown below.
What does loveelectric not include?
Continuing with our transparency ethos, we thought it best to outline what’s not included in our monthly pricing.
- Our quoted price does not include an electric vehicle charger. But we can advise on where best to get one and how to install it.
- You won’t be able to test drive the car beforehand, as it’s custom-made by the manufacturer for you and only once complete is delivered.
- We do not have an in-house energy tariff system. However, if you lease a car with loveelectric, you can still always sign up for an energy tariff system with a separate energy provider as well.
- We don’t do PCP or standard lease as we specialise in salary sacrifice schemes.
How loveelectric compares to other salary sacrifice schemes
Through your research, you’ve probably come across several leading companies in the UK that offer salary sacrifice schemes.
The main thing to note is that different providers include different features in their packages, making direct comparisons challenging.
Here’s a comparison table comparing features across various salary sacrifice providers:
For a more thorough examination of the different salary sacrifice providers, check out: Best Salary Sacrifice Car Scheme in the UK — Which One is Best for You?.
Our early termination scheme offers some of the highest protection
Early termination is one of the most important topics when it comes to a salary sacrifice scheme, so make sure to read all the fine print when signing up for a provider. Make sure you know how long it takes for protection to go live as an employer or employee, and what the conditions are.
As mentioned above, at loveelectric, our early termination scheme offers the shortest time before early termination protection kicks in (3 months for employees and 6 months for employers).
Other salary sacrifice providers might have a different arrangement, for example:
- Early termination protection only active after 6 months
- High penalties (often over £15k) to leave a contract
- A cap on the number of claims you can make per year
- No protection in case of parental leave
We offer the greatest transparency on our pricing
We’re the only company to give public sample quotes of our prices. Most other companies will put you on a call with their sales team for a quote. Many companies will claim to offer the cheapest monthly leases, but the prices are often a lot higher once the employee orders the car due to added fees or a deposit.
We like to be as transparent as possible from the beginning with our prices, which is why you’ll see all our fees at the beginning of this article.
We have B-Corp status pending, which, when approved, will open us up to the scrutiny of our finances. We believe this is a great way to build further trust with our customer base and lends itself to our transparency ethos.
For a clear view of our pricing options, see our infographic below.
We are specialists in the salary sacrifice scheme
What you might notice while researching different schemes is that most offer an array of services, such as:
- Standard electric car leasing
- Salary sacrifice schemes
- Combustion car leasing
At loveelectric, we specialise in salary sacrifice schemes. This allows us to offer a comprehensive, personalised service while also offering the best prices.
What should you keep in mind when choosing a salary sacrifice scheme service?
Since each salary sacrifice provider offers different services, it’s wise to ask the right questions before signing and agreeing to a contract.
Some questions to keep in mind to ask a salary sacrifice company:
- Are there any caps associated with the percentage or number of claims on the plan?
- How many months before the early termination protection kicks in?
- Are there any hidden fees not shown in the quoted monthly price from the website?
- Do you have to pay extra for the first few months?
- Do you have gap insurance?
- How do you manage the employee’s salary and payroll?
- What’s your post-care service like, and how much access do we have to support?
We've added some questions that we hear a lot from potential clients. They should clear up some of the topics not covered in this article.
Do you own the car after salary sacrifice?
You won’t have the option to buy the car after your lease is up with loveelectric.
However, keep into account that it might not always make sense to buy an electric car. The technology is adapting so quickly that owning an electric car that is 5 years old will put you at a considerable disadvantage. That’s why we feel it makes more sense to lease rather than own a car.
How much does EV salary sacrifice save?
You can save anywhere from 30-60% on a standard lease through a salary sacrifice scheme.
In most cases, savings are much larger if you’re in the higher tax bracket.
What is a salary sacrifice car scheme example?
We have done full examples of what a salary sacrifice scheme with loveelectric looks like in this article: Salary sacrifice electric car examples: how it works in practice.
To get a glimpse at what the payroll would look like for the employee and employer, see the infographic below.
Hopefully, this has given you all you need to know about loveelectric’s pricing and how it compares to other companies offering salary sacrifice schemes.
We’re always at hand to answer any further questions you might have, so feel free to reach out and make an enquiry if you do.
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