EV Salary Sacrifice Calculator UK 2026

Salary sacrifice is one of the most tax-efficient ways to get an electric car in the UK. Your employer deducts the monthly lease cost from your gross salary before tax and National Insurance, so you save income tax and employee NI on the sacrificed amount. In return, you pay Benefit-in-Kind tax on the car — but for a fully electric vehicle, BiK is just 4% of the car’s list price in 2026/27, making the net cost far lower than a personal lease. Use this calculator to see your numbers.

Your results

Annual saving vs personal lease

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Net monthly cost

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Monthly saving vs personal lease

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3-year saving

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Tax bracket

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Monthly tax breakdown

Income tax saved

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NI saved

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BiK tax payable

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Not financial advice. These figures are estimates based on the tax rates and thresholds you enter. Your actual saving will depend on your employer's scheme terms, your full tax position, and any salary sacrifice impact on benefits such as pension contributions, mortgage affordability, or statutory pay. Speak to your employer's HR team or a qualified financial adviser before making a decision.

Compare salary sacrifice schemes — Octopus EV | The Electric Car Scheme

What is EV salary sacrifice?

Salary sacrifice is an agreement between you and your employer where part of your gross salary is redirected to pay for a benefit — in this case, an electric car lease. Because the deduction happens before income tax and National Insurance are calculated, you save those taxes on the sacrificed amount. Your employer must offer a salary sacrifice scheme for you to use this.

The trade-off is Benefit-in-Kind (BiK) tax. HMRC treats the car as a taxable perk, calculated as a percentage of the car's P11D value (its list price). For fully electric cars, BiK is just 4% in 2026/27 — far lower than petrol and diesel cars — which is why the numbers work so well for EVs specifically.

How net monthly cost is calculated

The gross monthly sacrifice is reduced by the income tax and employee NI you save on that amount, then increased by the monthly BiK tax charge. The result is your actual take-home pay reduction — what you genuinely pay out of pocket for the car.

Tax rates used: 20% basic rate (£12,571–£50,270), 40% higher rate (£50,271–£125,140). Employee NI: 8% on earnings up to £50,270, 2% above. BiK rate for fully electric vehicles: 4% (2026/27).