Salary Sacrifice - Is your provider giving you all the details on EVs like the BMW i7

The New BMW i7 Salary Sacrifice - Is your provider giving you all the details

The notion of “salary sacrifice” has gone from relative anonymity to being one of the foremost ways in which a UK employee can access a new or used electric car. While salary sacrifice, or sal sac, is not a new phenomenon, it didn’t have anywhere near the impact on the UK’s car market pre-2020 as it does in 2026.

With sal sac you have a contractual arrangement between the employee and employer where their salary is reduced in exchange for non-cash benefits i.e. the vehicle. However, as a “benefit” to the employee, the company car tax rules on BiK apply, which for combustion vehicles is far more punitive than for zero-emitting vehicles.

In tax year 2020/2021, HMRC made a seismic announcement when they applied a 0% BiK rate on a zero-emission vehicle  (electric cars emit 0g/km from their tailpipe). Increasing by just 1% per annum, this change arose at a time when petrol and diesel vehicles were being more harshly managed by HMRC in terms of BiK and also at a time when the mass-adoption of EVs was starting.

From around 2020 / 2021, the UK started to access functional and practical options like the Tesla Model 3, Polestar 2 and Mercedes EQC. With some of the early innovations like the Nissan leaf and the Renault Zoe, not exactly meeting the needs of all EV drivers, the extent to which EVs would become so fundamental in company car and salary sacrifice market was perhaps unknown.

Fast-forward 5 or 6 years and a new pathway to electrification has been unearthed. To be clear, while e-car are NOT sal sal experts, we do recognise just how important this approach is to the entire industry in terms of sales and supply volumes.

Why does salary sacrifice work so well on an electric car?  

•  Before Tax Deduction – this is the big incentive, as the employee is able to use their gross salary (before tax) to pay for the vehicle, which reduces their income tax exposure. In cases of 40% income tax bracket employees, this represents an incredible saving on tax and National Insurance contributions;

•  No Deposit – a salary sacrifice scheme will not necessitate large upfront payments or deposits which are traditionally used in the car retail markets with PCH and HP solutions. For many UK drivers, managing their ongoing budgets and household cash-flow is integral;
• Robust Leasing Package – with most sal sac schemes the provision will include the vehicle, service and maintenance, tyres, breakdown cover, early termination provisions (to protect employee and employer) and motor insurance. Effectively what you pay in the salary sacrifice covers you for everything apart from the electricity / fuel and windscreen damage; 
• Whole of Life cost savings – even if the charge point installation is not always part of the sacrifice, the use of electricity over fuel (petrol and diesel) is far better economically. More so in 2026, when petrol has sky-rocketed to over £1.50 per litre and diesel at £1.90 a litre;

•  Access new vehicles (and not on your credit file) - for some employees with poor credit, or who do not want a new car on their credit file, the ability to access a new and exciting vehicle with the latest technology is a great benefit. As the employer is underwritten, this vehicle will not show on the employee’s credit file. For an employee with poor credit or who may be getting a mortgage / re-mortgaging their house, this may provide greater flexibility; and    
•  Employer Benefits – this not a scheme which just helps the employee, with the employer also enjoying key benefits like employee commitment and happiness from the scheme, National Insurance savings and also VAT savings (if this is not shared with the employee).  

However, are salary sacrifice providers in the UK doing enough for the employer and employee when they establish a scheme?

Many companies will advertise their services based on legal and employment compliance, easy to use portals and vehicle selections or great service and robust pricing. While this is very true in many cases, and some of our competition in the EV market are unbelievable at what they do, the often-forgotten part of the process is the car itself.

Does the company assisting you with the scheme understand and appreciate the EV in its entirety? Is the employee being encouraged to proceed based on the vehicle suitability (as opposed to just the financial suitability)? Does the employer receive help and advice on the right vehicle selection for those in the scheme? 

Standards of EV sales and leasing are improving for both the new and used markets. In the case of the latter, more “certificates” are being adopted to help salary sacrifice customers understand the used-EV and its performance. Brands like AVILOO, ClearWatt and Generational are utilising battery health reports and vehicle overviews.

However, in the new market, this isn’t standard practice, nor has the Government or any regulator made this standard practice. At e-car we use an EVC™ - Electric Vehicle Certificate – to help disseminate the information quickly and accurately. We cover integral aspects such as:

•  Range – the real-world performance in cold weather vs mild weather (and on motorways v city driving);
•  Charging Times – detailed analysis of the AC and DC charging metrics across a range of charging solutions;
•  Usable battery – helping customers understand the battery capacity v usable battery for clearly identifying charging costs;

•  Max Charging – setting out the max AC and DC charging capability for the EV to allow the driver to establish the correct habits and to help an employer set up practical charging solutions at the premises (if possible);
•  Towing weights – key for any employee with a trailer or caravan requirement;
•  Heat Pump – one of the most useful tools for an EV in winter / colder weather is often not properly identified to an employee;
•  Costs to charge – helping an employee to understand charging in the public network compared to domestic charging as well as the costs, and importance, of a dedicated EV tariff or reducing expenditure;
•  Performance – demystifying the use of kW on AV against the use of ps or bhp;
•  Bidirectional Charging – setting out the ability of an EV to utilise V2L, V2G and V2H as we see more homes with solar charging;
•  3rd party introductions – helping employees access useful resources like ZapMap for charge point location and more. 

On the surface it seems that each EV will bring with it a complicated suitability assessment. But with our “living with your …” overview and the EVC™ much of this is quickly and easily understood, especially when our EV experts guide the employer and employee through the process.

With most leasing arrangements in a salary sacrifice set at 3 years (36 months), selecting the right solution is necessary to limit employee concerns and complaints about their vehicle, which could create an issue for the employer. It also encourages more employees within the organisation to participate in the scheme too. 

Example of the BMW i7 EVC 

Luxury EVs, like the recently refreshed BMW i7, will all be available on almost any decent salary sacrifice EV scheme across the UK. The new “BMW i7” is a recrafted version of the previous luxury model, adding excellence in every detail and designed with careful dedication.

A statement of automotive excellence, the distinctive exterior design features the BMW Iconic Kidney Grille and Individual Crystal Headlights Iconic Glow plus a host of Neue Klasse technology. Expect the BMW Panoramic iDrive, Operating System X, two-tone combinations, Adaptive 2-axle air suspension, 3D HUD, Panoramic Vision and ambient lighting to feature.

The BMW Digital Key is your personal chauffeur, with the internal assistant helping you with navigation, communication and entertainment while on the road. Driver / passenger comfort is paramount with the adaptive air suspension, Integral Active Steering, host of driving modes including the Symbiotic Drive.

Inside, the car creates a “digital retreat” with the 31.3” 8K Theatre Screen, Dolby Atmos Sound and in the rear, the passenger can enjoy maximum legroom with extending footrest, massaging seats, heated seats and ventilation plus some intuitive passenger controls and commands. Looking for the elite luxury electric vehicle on fleet? Head to the  BMW  website to find out more. 

So how will the updated Model Year 2027 BMW i7 perform? 

•  50 - with a usable battery of 112.5kWh this AWD saloon offers 335kW (449hp), top speeds of 130 mph and 0-62 times of 5.5 seconds. Real-world ranges suggest a combined 295 miles in colder weather with warmer temperatures to allow for 395 miles (on a full charge) – 345 miles combined . The 11kW AC allows for 0-100% charging times of 12 hours and 15 minutes with the 200kW DC enabling 10-80% in 28 minutes. The BMW i7 has no confirmed Bidirectional charging. It has a 124 mpg equivalent and 500L cargo volume. The BMW i7 can tow 750kg (Unbraked) and 2000kg (Braked). The heat pump is standard;

•  60 - with a usable battery of 112.5kWh this AWD saloon offers 400kW (536hp), top speeds of 149 mph and 0-62 times of 4.8 seconds. Real-world ranges suggest a combined 295 miles in colder weather with warmer temperatures to allow for 395 miles (on a full charge) – 345 miles combined . The 11kW AC allows for 0-100% charging times of 12 hours and 15 minutes with the 250kW DC enabling 10-80% in 28 minutes. The BMW i7 has no confirmed Bidirectional charging. It has a 124 mpg equivalent and 500L cargo volume. The BMW i7 can tow 750kg (Unbraked) and 2000kg (Braked). The heat pump is standard;
• 70- with a usable battery of 112.4kWh this AWD saloon offers 500kW (671hp), top speeds of 155 mph and 0-62 times of 3.8 seconds. Real-world ranges suggest a combined 280 miles in colder weather with warmer temperatures to allow for 375 miles (on a full charge) – 330 miles combined . The 11kW AC allows for 0-100% charging times of 12 hours and 15 minutes with the 200kW DC enabling 10-80% in 28 minutes. The BMW i7 has no confirmed Bidirectional charging. It has a 119 mpg equivalent and 500L cargo volume. The BMW i7 can tow 750kg (Unbraked) and 2000kg (Braked). The heat pump is standard;   

Want to know more about going into the BMW i7 Electric?

Head to our dedicated BMW special offers section or speak to our experts directly on 01942 910 001 or by emailing us at [email protected]