Volkswagen cars and salary sacrifice: the perfect combination for businesses
Volkswagen UK and Volkswagen Financial Services UK (VWFS) are helping businesses and their employees to accelerate towards a more sustainable and cost-effective future, With their award-winning range of electric and plug-in hybrid cars. Combining practicality, reliability and comfort, and now a new salary sacrifice car scheme from VWFS is making them affordable and more accessible for businesses and drivers across the UK – just in time for those who want to go electric in 2026.
Why salary sacrifice?
Salary sacrifice lets employees exchange part of their gross salary for a non-cash benefit – in this case, a brand-new electric or plug-in hybrid car. This delivers significant financial advantages for both employers and employees:
- Tax efficiency: electric vehicles (EVs) currently attract a benefit-in-kind (BIK) rate of just three per cent – much lower than the 30 per cent that applies to many petrol and diesel cars. Plug-in hybrid electric vehicles (PHEVs) with low CO₂ emissions also benefit from low BIK rates
- National Insurance savings: Businesses can typically save £80 to £100 per employee per month on Class 1A National Insurance contributions, while employees enjoy lower National Insurance deductions (depending on circumstances). Many companies use their savings to reduce the overall cost of car rentals for their employees
- Cost-neutral for employers: VWFS manages the entire process, from set-up to compliance, at no cost to the business. The scheme includes insurance, servicing, maintenance, breakdown cover and 24-hour Driverline support – all backed up by VWFS fleet specialists to help reduce administrative burden
- Driving sustainability: the scheme supports corporate environmental, social and governance (ESG) goals by promoting low-emission travel. With the UK’s 2030 ban on selling new petrol and diesel cars approaching, salary sacrifice is a practical step towards meeting net-zero targets
- Attract top talent: the boost in employee benefits helps companies to attract, reward and retain staff
Employee benefits
Employees still need to pay company car tax, but they gain access to a fully inclusive package from VWFS with:
- No upfront payment or credit checks
- Class-leading lifestyle support to cover unforeseen changes such as redundancy or long-term illness
- Affordable monthly payments are taken from an employee’s gross salary, making EV ownership tax-efficient and easier than ever
Volkswagen’s award-winning electric and plug-in hybrid range
Volkswagen – the UK’s biggest-selling car brand since 2021 – offers a diverse line-up of electric and hybrid models to suit every lifestyle, including business users.
From the compact ID.3 to the versatile ID.4, elegant ID.5 and the spacious ID.7 and ID.7 Tourer, Volkswagen’s all-electric range combines cutting-edge technology with excellent reliability.
The ID.7 models in particular are popular choices among company car drivers, combining supreme comfort, impressive range up to 433 miles (WLTP combined) and fast charging with up to 200 kW of DC electricity. Topping up from 10 to 80 per cent can take as little as 26 minutes – perfect for short breaks on long journeys.
The Volkswagen Golf, Tiguan and Passat eHybrid models can deliver up to 88 miles of electric-only range, ultra-low CO₂ emissions and rapid charging capability. These cars seamlessly blend electric power for everyday journeys with petrol confidence for longer trips, offering flexibility without compromise.
The ID.7 Tourer was named Best Electric Estate and Best Large Family Car this year by What Car? and Parkers respectively, while the ID.7 fastback model won Best EV at the Leasing.com Awards, and the ID.4 was named Electric Car of the Year at the Fleet Procure Awards. The Golf eHybrid was this year named Best Hybrid by both Autocar and Cinch.
To find out more about how salary sacrafice can help you and your business, contact our fleet solutions team on 01202 367301 (option 2)