Business Car Manager: Editor’s Blog
MATT Dyer is back with his feet on the ground. After 12 years looking after LeasePlan’s international affairs – which meant an intimate knowledge of Heathrow airport – he’s back at LeasePlan UK as the leasing company’s commercial director.
I had exchanged email information requests in the past, but I’d never had a chance to meet Matt. Until last night.
Relaxed and accommodating, Matt updated his recent history and then introduced me to his latest baby, so to speak.
It’s called SalaryPlan. Like many leasing companies are offering now, it’s a salary sacrifie benefits package but with the backing of the second biggest leasing company in the UK. And, says Matt, the understanding of how to make it work with HR departments. And, as Matt reminded me, “We’re the first of the top five leasing companies to do this.”
So what is salary sacrifice? It is a way to reduce the tax burden of employees basically – but given HMRC blessing.
To be more technical, salary sacrifice takes place when an employee gives up the right to part of their cash remuneration in return for a non-cash benefit – in this case a car – as part of a structured scheme.
According to LeasePlan the key benefits of salary sacrifice are national insurance and income tax savings, along with a cost effective way of putting employees in new vehicles. More to the point, salary sacrifice and cars really works when employees choose greener, less polluting cars. So there’s a two-fold benefit: lower tax; fewer emissions.
“You need to choose a car with CO2 emissions of between 120g/km-130g/km to make it really work,” says Matt.
To be honest, salary sacrifice is not really the preserve of small businesses. It’s a big company benefits package scheme. Rather like a web browser plug in that provides additional versatility in your web browsing experience, so SalaryPlan fits into a big company’s suite of employee benefits.
“You really need upwards of 250 employees to make it work,” confirms Matt. “And the cost of implementation is somewhere between