How do I set up and run an electric car salary sacrifice scheme?
Employee benefits are a brilliant way to attract, retain and reward your hard-working team.
Our electric vehicles salary sacrifice scheme is a great employee benefit to offer your staff members, giving them access to a brand new electric car and making savings by paying for it through their gross salary.
Some of the UK’s top businesses have chosen Octopus Electric Vehicles salary sacrifice scheme for their employees. We work with employers looking to incentivise their teams to switch to electric cars, reduce their carbon footprint to meet their Environmental, Social and Governance (ESG) goals and give their team access to significant savings on brand-new electric cars as a perk.
Setting up new benefits schemes shouldn’t come with lots of extra work for the payroll and finance department. Here's how to get set up with our salary sacrifice scheme, and how much time it'll take to run it once your business has joined.
How do we get set up on the scheme?
Once you’ve given us the go-ahead the process is simple.
First, your business will go through a credit check so we can create a line of credit for your business. This tells us how many cars you’ll be able to get. We’ll work with your finance team to get all of the paperwork over to our credit team. When we've got that, it can take up to a week to get a decision.
Once we’ve completed the credit check we’ll send you the paperwork to set up the scheme.
You'll have three simple forms to complete including an agreement between Octopus Electric Vehicles and the company, a Direct Debit form, and a company sign up form. Once these have been signed we’ll do some quick anti-money laundering checks as part of our compliance.
Once that’s all gone through, you’re good to go!
Admin time = 1 day
How much admin does it take to set up an employee on the scheme?
Octopus Electric Vehicles is a leasing company, so we own the cars and lease them to your business. Your business then registers the employee as the driver of that car. There are three parts to this.
The first document we’ll send to be signed by the employee and countersigned by the company. This is the Driver Agreement. It's the legal agreement with your employees that allows them to reduce their salary in exchange for the benefit.
Then we’ll ask the employee to sign the Driver Handbook which includes the code of conduct and Ts&Cs.
A nominated person within the company, usually from HR or Finance, needs to sign the Hire Schedule which is the agreement between themselves and Octopus Electric Vehicles.
If you don’t payroll your benefits you’ll need to tell HMRC that the employee is starting to take benefits by completing a P46 form. This form tells HMRC to change the employee's tax code to apply the Benefit in Kind tax.
If your company payrolls its benefits you don’t need to tell HMRC as the tax will be deducted at source.
Admin time = 25 mins
How much time does it take to run the scheme each month?
The only thing you need to do each month is to reclaim the cost of parking fines or speeding tickets from the employee's net salary. We’ll take the payment via direct debit and you’ll just need to adjust the net salary payments to compensate.
Admin time per month = 2 minutes for each employee
It takes most employers around two weeks to join our salary sacrifice scheme. We’ve turned the whole thing around in 7 days for some businesses, from the first conversation to the order of the first car. The ongoing admin of the scheme will take less than an hour a month. Our salary sacrifice scheme is a time and cost-effective way to reward your employees.
Our team are on hand to help you every step of the way.