How much could you save on an electric vehicle through salary sacrifice?

Electric vehicles are becoming increasingly popular, but remain unaffordable for many would-be owners. Is salary sacrifice the most economical way to drive an EV?

Porsche Taycan 4S Sport Turismu battery electric performance estate car on display at the AutoSalon on January 10, 2025 in Brussels, Belgium
(Image credit: Sjoerd van der Wal/Getty Images)

Salary sacrifice is an increasingly popular method of getting behind the wheel of electric vehicles (EVs). It offers significant tax advantages, and makes a financially sound means of accessing EVs for many people.

But how much money could it actually save you?

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Swipe to scroll horizontally
Header Cell - Column 0

Monthly car cost

Fuel

Insurance

Insurance group for EV = 26E

Service & Maintenance

Upfront payment

Total monthly cost, including upfront payment for PCH EV

Total term cost, INCLUDING initial upfront payment for PCH EV

Curpa Born

Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Row 0 - Cell 4 Row 0 - Cell 5 Row 0 - Cell 6 Row 0 - Cell 7

20% tax payer cost

£403

£7

£0.00

£0.00

£0.00

£409

£19,640

40% tax payer cost

£346

£7

£0.00

£0.00

£0.00

£353

£16,937

Cupra Born

Row 3 - Cell 1 Row 3 - Cell 2 Row 3 - Cell 3 Row 3 - Cell 4 Row 3 - Cell 5 Row 3 - Cell 6 Row 3 - Cell 7

PCH cost

£336

£8

£52

£39

£336

£442

£21,238

Swipe to scroll horizontally

Savings (EV on salary sacrifice vs. PCH)

Monthly car cost

Fuel

Insurance

Service & Maintenance

Upfront payment

Total monthly cost, including upfront payment for PCH EV

Total term cost, INCLUDING initial upfront payment for PCH EV

20% tax payer - £

-£66

£1

£52

£39

£336

£33

£1,599

40% tax payer - £

-£10

£1

£52

£39

£336

£90

£4,302

Swipe to scroll horizontally
Header Cell - Column 0

Monthly car cost

Fuel

Insurance

Insurance group for EV = 26E

Service & Maintenance

Upfront payment

Total monthly cost, including upfront payment for PCH EV

Total term cost, INCLUDING initial upfront payment for PCH EV

Total term cost, INCLUDING resale value

Curpa Born

Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Row 0 - Cell 4 Row 0 - Cell 5 Row 0 - Cell 6 Row 0 - Cell 7 Row 0 - Cell 8

20% tax payer cost

£403

£7

£0.00

£0.00

£0.00

£409

£14,730

£14,730

40% tax payer cost

£346

£7

£0.00

£0.00

£0.00

£353

£12,703

£12,703

Cupra Born

Row 3 - Cell 1 Row 3 - Cell 2 Row 3 - Cell 3 Row 3 - Cell 4 Row 3 - Cell 5 Row 3 - Cell 6 Row 3 - Cell 7 Row 3 - Cell 8

Cash purchase cost

£0

£8

£52

£39

£35,000

£1,071

£38,566

£15,566

Swipe to scroll horizontally
Header Cell - Column 0

Monthly car cost

Fuel

Insurance

Insurance group for EV = 26E

Service & Maintenance

Upfront payment

Total monthly cost, including upfront payment for PCH EV

Total term cost, INCLUDING initial upfront payment for PCH EV

Total term cost, INCLUDING resale value

Curpa Born

Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Row 0 - Cell 4 Row 0 - Cell 5 Row 0 - Cell 6 Row 0 - Cell 7 Row 0 - Cell 8

20% tax payer cost

£403

£7

£0.00

£0.00

£0.00

£409

£19,640

£19,640

40% tax payer cost

£346

£7

£0.00

£0.00

£0.00

£353

£16,937

£16,937

Cupra Born

Row 3 - Cell 1 Row 3 - Cell 2 Row 3 - Cell 3 Row 3 - Cell 4 Row 3 - Cell 5 Row 3 - Cell 6 Row 3 - Cell 7 Row 3 - Cell 8

Cash purchase cost

£0

£8

£52

£39

£35,000

£828

£39,755

£20,755

Dan McEvoy
Senior Writer

Dan is a financial journalist who, prior to joining MoneyWeek, spent five years writing for OPTO, an investment magazine focused on growth and technology stocks, ETFs and thematic investing.

Before becoming a writer, Dan spent six years working in talent acquisition in the tech sector, including for credit scoring start-up ClearScore where he first developed an interest in personal finance.

Dan studied Social Anthropology and Management at Sidney Sussex College and the Judge Business School, Cambridge University. Outside finance, he also enjoys travel writing, and has edited two published travel books.