Car Finance Comparison
Salary Sacrifice Car
Lease vs PCP vs Buy
EV BIK Rate
2%
Petrol BIK
28%
Should you get your next car through salary sacrifice, PCP finance or buy outright? This 3-way comparison shows the true cost of each option after tax savings, BIK charges and depreciation. Especially powerful for electric vehicles where the 2% BIK rate makes salary sacrifice dramatically cheaper.
Your Details
Salary Sacrifice Quote
PCP Alternative
Salary sacrifice is cheapest
Saves £0 over 3 years
Salary Sacrifice
PCP Finance
Cash Purchase
How the salary sacrifice car calculator works
The calculator compares three ways to get your next car. Salary sacrifice deducts the lease cost from your gross pay before tax and NI, saving you 20-45% income tax and 2-8% NI on the amount sacrificed. You pay a small Benefit in Kind (BIK) tax on the car's list price — just 2% for EVs, 5% for hybrids, 28% for petrol. The net cost is dramatically lower than paying from post-tax income.
PCP finance is paid from your net (post-tax) salary. You put down a deposit, make monthly payments, then either pay the balloon to own the car, hand it back, or trade it in. Cash purchase uses post-tax money upfront, and the true cost is the depreciation over the ownership period.
For electric vehicles, salary sacrifice almost always wins. A £40,000 EV at £500/month sacrifice costs a 40% taxpayer just £307/month after tax and NI savings, with only £27/month BIK. The same car on PCP at £350/month costs £350 from post-tax income — plus deposit and balloon. Use our salary sacrifice calculator for a general sacrifice comparison.
Frequently asked questions
Is salary sacrifice worth it for a car?
For electric vehicles, almost always yes. The BIK rate on EVs is just 2% for 2026/27. A £40,000 EV through salary sacrifice at £500/month saves a 40% taxpayer around £240/month in tax and NI. For petrol cars the BIK is 28%, making savings much smaller.
What is the BIK rate for electric cars in 2026/27?
The BIK rate for fully electric vehicles is 2% of list price. On a £40,000 EV, that's £800 BIK value per year — costing a basic rate taxpayer £160/year in extra tax.
How does salary sacrifice car leasing work?
Your employer leases a car and deducts the cost from your gross salary before tax and NI. This reduces your taxable pay, saving income tax and NI on the sacrifice amount. The lease typically includes insurance, maintenance, road tax and breakdown cover.