According to Fleet News more than a third of fleet companies have introduced salary sacrifice.
What is Salary Sacrifice?
Salary Sacrifice is a government backed scheme designed to help employers and workers save on their tax. Employers will volunteer to forgo a portion of their salary in exchange for non-cash benefits provided by their employer. Traditionally, salary sacrifice schemes have been implemented to offer benefits such as pension contributions, childcare vouchers and cycle-to-work schemes. However, the concept has changed in recent times, where companies include vehicles as part of the package, leading to significant shifts in fleet management strategies.
How is this beneficial for organizations?
- Enhanced employee benefits – The introduction of salary sacrifice schemes contribute to a comprehensive benefit package. The ability to offer greener transportation options also aligns with corporate social responsibility initiatives, showcasing the organizations commitment to sustainability and environmental stewardship.
- Cost savings – By leveraging the collective purchasing power of their employees, companies can negotiate better deals with vehicle manufacturers or fleet management providers. Additionally, salary sacrifice schemes often lead to reductions in National Insurance contributions, resulting in financial savings for the organization.
- Improved fleet sustainability – The adoption of salary sacrifice schemes enables companies to transition their fleets to more eco-friendly alternatives. This shift not only meets the sustainability targets but also helps enhance the company’s brand image.
What will the benefits be for the employees?
- Financial savings – Salary sacrifice schemes provide employee’s with the opportunity to access vehicles at discounted rates, often leveraging the employer’s purchasing power and negotiated deals. This can result in substantial savings compared to the traditional routes of purchasing or leasing a vehicle independently.
- Simplicity and convenience – Salary sacrifice schemes streamline the vehicle acquisition process for employees. They eliminate the need to search for suitable financing options or navigate the complexities of vehicle maintenance and insurance. With the employer taking care of these aspects, employees can focus on enjoying their new vehicles hassle-free.
- Access to greener vehicles – By participating in a salary sacrifice scheme, employees can upgrade their current vehicles to more environmentally friendly options, such as electric or hybrid cars. This not only reduces carbon emissions but also aligns with the employee’s personal commitment to sustainability.
How can Fleet Management impact Salary Sacrifice?
Effective fleet management can result in cost savings for businesses with fleet acquisition, maintenance and fuel consumption. Furthermore, it enhances safety by using advanced tracking technologies, telematics and driver monitoring tools. Being able to track these tools, it means employers will be able to improve their driver behaviour, reducing the risk of accidents. However, Fleet management also ensures optimal utilization of company vehicles. Intelligent route planning, real-time tracking, and automated scheduling help minimize downtime, reduce mileage, and enhance productivity. Overall, it will be a cost saving benefit whilst also supplying fleet managers with the data needed to control their fleet efficiently.
Fleet Concerns Over Clean Air Zone Restrictions – https://www.autoserve.co.uk/fleet-concerns-over-clean-air-zone-restrictions/
Is EV Infrastructure Ready For The Fleet Market Business Sector – https://www.autoserve.co.uk/is-ev-infrastructure-ready-for-the-fleet-market-business-sector/
With over 16,000 approved garages, a 24/7 support service and a host of cost-saving offers, we can keep your fleet moving and operational. Call one of our professional Service Advisers on 0121 521 3500 for more details.