How HR will be affected by today's legislative changes

Salary sacrifice, and the ramifications for fleet management

Speaking in the latest issue of HR Grapevine, Stephen Briers, Editor-in-Chief of Fleet News, was quick to calm the panic surrounding salary sacrifice changes, which will effectively limit employer National Insurance contributions and Income Tax – which, in turn, will affect those who receive benefits in kind (BiK).

“Initially, there were shockwaves,” he says. “Was car salary sacrifice dead as a result of the Government consultation into the taxation benefits? Subsequently clarification, including the removal of ultra-low emission cars from the changes (cars with CO2 emissions up to 75g/km), settled the nerves.

“Salary sacrifice is not dead, just slightly more complicated. Buy a car up to 75g/km and nothing changes. Buy a car with higher emissions and the employee will now pay tax on the greater of either the car benefit-in-kind or the sacrificed salary.”