Employee Benefits in a post consultation world

Salary Sacrifice your way to a new car
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www.fleetevolution.comSalary Sacrifice your way to a new car
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www.fleetevolution.com
Salary Sacrifice Scheme Overview

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What’s in todays session?
Agenda
Why have benefits?
Why was salary
sacrifice reviewed?
What will change?
Focus on employee
car schemes
Close

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Welcome
Award Winning Salary Sacrifice Experts
Employee Car Scheme Specialist
Min 20 employees (lite scheme)
Min 200 – 10,000 employees (full scheme)
Fully managed risk free schemes,
Fully inclusive costs

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WHY HAVE BENEFITS
Section 1

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Why have benefits?
 The cost of replacing a ‘leaver’ is estimated at £25,000!
 Most employees stay at companies where they feel valued
 Employee benefits can increase productivity and reduce cost
 Help make you an employer ‘of choice’
 Benefits don’t have to cost money
 The best benefit offerings evolve as your employees do
Setting the
Benefit Scene

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Salary Sacrifice Overview
Salary Sacrifice or salary ‘exchange’ is effectively a way of exchanging cash salary, pre tax for goods or services.
Thus saving the tax and NI and possible other savings.
In essence salary sacrifice allows employees to define their own package, subject to your rules.
Typical savings at the moment are between 20% - 45% on everything from childcare to ipads.
The savings are generated by a mixture of the following, this varies by benefit and employer;
Volume discounts on list price
Low cost of finance leveraging employers rates
VAT reclaim
Employers NI saving
Tax Saving
Employees NI saving
However some benefits are already subject to a ‘Benefit in Kind’ tax which erodes these savings

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What Employees Want
Keeping Staff Happy Isn’t All About Benefits
43% of employees claimed that enjoying their work was a
major motivator in staying put. Job security and good
colleagues were also named as reasons why employees would
not jump ship.

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Why has salary sacrifice been
reviewed?
Benefits all?
Benefits just employees??
Benefits tax evasion only??
Estimated
£5 billion
cost to treasury!

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What will change?
 Childcare vouchers, Payroll Giving, Pensions, Cyclescheme and cars below 75g/km CO2 ‘ringfenced’ with no changes
 All other salary sacrifice arrangements will attract a benefit tax (BIK) equivalent to tax saving
This will wipe out all the tax savings from salary sacrifice but (where applicable) other savings will remain.
Deadlines/Grandfathering
Any existing salary sacrifice arrangement or new arrangement implemented prior to April 6th will continue on the
current rules until April 2018
For more polluting cars, accommodation and school fees entered into (ordered) prior to April 6th rules will not change
until April 2021
For schemes such as cars that have always had a corresponding benefit in kind charge any changes will be minimal

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SO WHERE ARE WE NOW?
Section 2

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Dead? Or Evolving?
Typical components of salary sacrifice savings
Up to 30% volume discount
20% tax saving
12% employee NI saving
13% VAT saving
5% cost of finance
+ convenience
+ time savings

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Dead? Or Evolving?
Typical components of salary sacrifice savings
Up to 30% volume discount
20% tax saving wiped out by BIK
12% employee NI saving
13% VAT saving
5% cost of finance
+ convenience
+ time savings
But employers NI savings removed, portals beware

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Adaptable and Inclusive
Simplicity is the Key
Part time staff
Living wage
Contractors
Established Staff
less than 10,000
business miles
High mileage
essential users
Plus fleet management and grey fleet
management too!

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What is a ULEV?
An ‘Ultra Low Emission Vehicle’ is one emitting less than 75grams of CO2/km driven
Currently 200 on our scheme, 500 expected by end of year
Electric cars with 200 mile range +
£20,000 to £80,0000

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Our Engagement Strategy
Pre launch teasers
Launch with product
3 month refresh
Eshots
Catch ups
Social Media
Proactive calls
Payroll Inserts
+
Parking season tickets
Train season tickets
Affinity
Ecos

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Did You know?
• In an IPP survey the company car was seen as the most attractive benefit by 25-45 year olds?
• Salary sacrifice car schemes have now been introduced by 15% of employers who have a flexible
benefit offering (1,000 employee plus)
• 82% of adopters have never had a new car before
• The typical saving is 30% compared to retail
• The fastest car on our scheme does 0-60 in less than
3 seconds
• Adopters of salary sacrifice car schemes
report reductions in CO2 of 42%

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The Perfect Company?
Employees Earning
above £20,000
Above Average
Retention
Open to
Heavy Promotion

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WHAT MAKES US DIFFERENT
Section 3

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Why Choose Fleet Evolution?
Every other supplier puts the emphasis on you making the scheme a success
We put the emphasis on us, we take all responsibility for the schemes success
Admin
• Low admin
• No FCA compliance needed
Risk
• No termination risk
• No risk of issues around periods of no pay
Costs
• No set up cost nor minimum volume
• No marketing cost or admin

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SALARY SACRIFICE CARS
Section 4

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Maximise your Savings
You can save up to half your motoring costs by taking a salary sacrifice car, but
this saving is eroded by “Company Car Tax”, out simply the higher to CO2 the
lower the saving and indeed some more polluting cars may be better taken as
a personal deal…get the picture?

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Sub
50
50-100 g/km
100-120 g/km
120-130 g/km
45% Saving
33% Saving
25 % Saving
12%
Saving
Electric cars, Plug in Hybrids, Nissan Leaf
Mitsubishi Outlander, BMW i3
Full Hybrids, Bluemotion, Econetic Models
Lexus CT/IS Hybrids, VW Golf, Ford Fiesta
Audi ‘Ultra’, BMW ‘Efficient Dynamics,
Mercedes ‘Blue Efficiency”
Some SUV’s/4x4’s, BMW 5 Series, Audi A5
CO2
Typical Savings
(Compared to Retail)
Typical Cars (in Band)

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Sub
50
51-75
76 – 120 Co2
120-130 g/km
45% Saving
33% Saving
20 % Saving
12%
Saving
Electric cars, Plug in Hybrids, Nissan Leaf
Mitsubishi Outlander, BMW i3
Full Hybrids, Bluemotion, Econetic Models
Lexus CT/IS Hybrids, VW Golf, Ford Fiesta
Audi ‘Ultra’, BMW ‘Efficient Dynamics,
Mercedes ‘Blue Efficiency”
Some SUV’s/4x4’s, BMW 5 Series, Audi A5
CO2
Post April orders
(Compared to Retail)
Typical Cars (in Band)

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Benefits to Employer
• Tailored to your requirements
• Protection against risk
• Fully managed
• NI Savings
• Increased level of applicants
• Improves retention
• Improves productivity
The most ‘visible’ of all flexible benefits

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Questions?
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Employee Benefits in a post consultation world

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