Betekintés: Salary Sacrafice, Car Scheme

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Source: http://www.doksi.net

SALARY SACRIFICE
CAR SCHEME

www.knowlesfleet.com
01206 255420

Source: http://www.doksi.net

ABOUT THE SCHEME
SALARY SACRIFICE PROVIDES THE OPPORTUNITY FOR ALL ELIGIBLE EMPLOYEES
TO HAVE ACCESS TO A BRAND NEW CAR.
Salary sacrifice allows you to pay for a car by reducing the amount you earn before tax and
national insurance is applied.
The main benefit is that you will save Income Tax, National Insurance and Pension
Contributions once the salary sacrifice has been applied.
To qualify you must be a permanent employee and be paid above the national minimum wage
after your salary has been reduced.

HOW TO OBTAIN QUOTES
You can use our online service or contact our office for assistance. We need to know your salary and tax code to calculate accurate savings.
Signing up to www.knowlesfleet.com is quick and simple. You will have a personal welcome
page where you can request new quotes and view all previous requests.
Your quotes will normally be available to view within 24 hours of submission.
WHAT VEHICLE CAN I CHOOSE
You can choose any car that is available in the UK with your employers approval.
The Public Sector gets some of the largest discounts available and we choose the best price
from 8 leasing companies to ensure that you get the best deal.

Low CO² & low list price = Greatest savings

Source: http://www.doksi.net

IS THERE A LIMIT TO HOW MANY QUOTES I Knowles Associates if you have a problem
CAN HAVE
during the life of the contract.
There is no limit to the number of quotes that WHO IS INSURED TO DRIVE THE CAR
you can request. However, we have a limit of
five cars per session to enable us to turn The car is insured for you and your partner.
round the quotes quickly.
Additional drivers may be added at an
increased cost.
We suggest you initially request quotes for the
basic model of different vehicles without too WILL I NEED TO PAY A DEPOSIT
many extras for comparative purposes. Once
you have decided which car you would like, There is no deposit and no credit checks.
you can then enhance the specification and
CONTRACTED MILEAGE
add extras.
If you need advice, please contact our The annual mileage will be agreed before the
dedicated team on 01206 255420.
car is ordered. You must submit a mileage
claim each month for any business mileage
HOW DO I PROCEED WITH A CAR
travelled.
If you are happy with the quote, complete your An excess mileage charge will apply if the
application online and follow the progress of contracted mileage is exceeded.
the car from order through to delivery.
END OF CONTRACT ARRANGEMENTS
PROGRESS OF MY ORDER
At the end of the contract you can:
We will automatically inform you weekly of  Replace your car with a brand new one
progress or changes to the estimated delivery  Purchase it
date. It will not be necessary for you to contact
 Return the car
us.
You will be required to return the car in a
clean and tidy condition. If the car is returned
with previously un-notified damage beyond
The standard term is 36 months, but other
normal fair wear and tear you may be
periods can be arranged.
responsible for any additional charges. A fair
wear and tear guide is available on our
WHAT IS INCLUDED IN THE CONTRACT
website.
CONTRACT TERM

You will be provided with a new car including
CAR BENEFIT TAX
insurance, maintenance and servicing. It also
includes road fund licence, accident
A salary sacrifice car is a company car and all
management, and breakdown and recovery
cars provided under this type of arrangement
services.
will attract car benefit tax and will affect your
tax code. An estimate of your tax liability will
All replacement parts such as tyres, batteries
be provided in each quote you receive. You
and exhausts are included in the contract
will receive a P11D form at the end of each
(subject to being a result of ‘fair wear and
tax year which will confirm your taxable
tear’). You will also have the full support of
benefit.

Sign up at www.knowlesfleet.com
or call us on 01206 255420

Source: http://www.doksi.net

HOW WILL THE SCHEME AFFECT ME?
It is crucial to understand what a sacrifice will
mean in practical terms before entering any
arrangement. You should consider the effect
that a reduction in pay may have.

Salary Sacrifice may also affect your
entitlement to the following:
 Statutory Sick Pay (SSP)
 Statutory Maternity Pay (SMP)
 Ordinary Statutory Paternity Pay (OSPP)
NATIONAL MINIMUM WAGE
 Additional Statutory Paternity Pay (ASPP)
The minimum wage is a key factor when  Statutory Adoption Pay (SAP)
considering salary sacrifice. This is because  State Pension
current legislation does not allow you to be  Any means-tested benefits
paid below this amount.
 Tax Credits
If you have a salary sacrifice arrangement
SALARY SACRIFICE AND CONTRIBUTIONthat takes you below this limit you must give
BASED BENEFITS
up the item you sacrificed.
STATE PENSION,
CREDITS

BENEFITS

AND

TAX

Salary Sacrifice could have an effect on your
entitlement to state benefits and tax credits
and so should be carefully considered before
you decide to proceed.
When you sacrifice cash pay in return for a
car, you will not pay National Insurance
Contributions (NICs) on the value of the pay
you sacrificed. Although this means you will
save NICs it also cuts the earning on which
you pay NICs and may take your earnings for
which NICs are due below the Lower
Earnings Limit (LEL) (£109 per week in 201415).

Entitlement to contribution-based benefits is
related to the amount of NICs you pay.
Reducing your pay by way of Salary Sacrifice
may reduce the amount of earnings that you
pay NICs on to below the LEL so that you are
no longer paying NICs.
Even if your earnings remain above the LEL,
the reduction in the amount of NICs you pay
could reduce your entitlement to contributionbased benefits.
Contribution-based benefits include:
INCAPACITY BENEFIT

If your deductible earnings fall below the LEL,
you may not be entitled to Incapacity Benefit,
If this happens, you may be entitled to
Income Support based on Incapacity which is
Entitlement to some benefits is based on the
a means tested benefit.
amount of NICs you pay and others on the
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amount of your earnings. Entering into a
SALARY
SACRIFICE
AND
EARNINGSsalary sacrifice arrangement could affect
RELATED BENEFITS
current or future entitlement to a range of
benefits.
Entitlement to earnings-related benefits is
based on your level of earnings, not including
For most, paying less NICs may not
any amount sacrificed.
adversely affect your benefit entitlement
because you may still be paying enough NICs
Earnings-related benefits include:
to qualify for benefits, you may be deemed to
still be paying enough NICs or if you only
MATERNITY ALLOWANCE
sacrifice for a short time your contribution
history will only be affected for that period
If your cash earnings fall below £30 per week
therefore the effect on your benefit
your will lose your entitlement to Maternity
entitlement would be minimal.

Source: http://www.doksi.net

Allowance (MA). If your cash earnings fall sacrifice schemes.
between £30 and £125 per week you will still
be entitled to MA but at a variable rate. If your STATUTORY SICK PAY/LONG TERM SICKNESS
earnings are £125 a week or more you will
If your average weekly earnings fall below the
receive the full standard amount of MA.
LEL you will lose your right to Statutory Sick
SALARY SACRIFICE AND WORK-RELATED Pay (SSP). If this happens you may still be
PAYMENTS
entitled to Income Support or Incapacity
Benefit.
Work-related payments paid by your employer
are based on your average earnings over a You can stay in the scheme during periods of
fixed period of time before you begin receiving sickness provided that your sick pay, after
them. The amount sacrificed is not included salary sacrifice, does not fall below the
as part of your average earnings for national minimum wage. It is not advisable to
calculating these payments, so the amount enter the scheme if you know or suspect that
you receive could be reduced as a result of you may need to take extended periods of
the sacrifice.
leave, i.e. surgery.
Work-related payments include:
MATERNITY PAY
The Statutory Maternity Pay (SMP) that you
are entitled to is calculated based on your
earnings during the eight week period leading
up to the 15th week before the baby’s due
date. If you are sacrificing salary during this
period the SMP will be calculated on the lower
amount.
To ensure that your SMP is not reduced, you
can decide to either; stop the salary sacrifice
and return the vehicle before the SMP
calculation period, or retain the vehicle but
transfer the salary sacrifice to a salary
deduction arrangement again before the SMP
calculation period.

If long term sickness develops during the
period of the sacrifice, this can be treated as a
life style change and the car could be retained
under a salary deduction arrangement.
PAYMENTS ABOVE BASIC SALARY
Payments over and above the basic salary,
that are based on an hourly rate, such as
overtime, call out etc. will not be affected by
the sacrifice.
EARLY RETIREMENT
In the event of an early pension due to
redundancy etc. the pension may be based on
the lower salary (after the sacrifice is applied),
for further information contact your payroll
department.

If you are pregnant or expect to have a period REDUNDANCY PAYMENTS
of maternity leave you should carefully
consider whether to join the scheme.
Redundancy pay may be affected by salary
sacrifice, for further information contact your
Occupational
Maternity
Pay
(OMP) payroll department.
calculations are not affected by salary

Source: http://www.doksi.net

SALARY SACRIFICE FAQ
WHAT HAPPENS IF MY EMPLOYMENT AT THE TRUST ENDS FOR WHATEVER REASON?
If you choose to leave the scheme early a termination charge may apply. The charge will
depend on the car and when it is returned. An indication of the early termination charge is
provided on the quote.
If you leave your post with the Trust for whatever reason, the agreement will also terminate.
Under the terms and conditions of the agreement any outstanding amounts can be taken
from your final salary as a net payment.
If your final salary does not cover the outstanding balance we will send you an invoice requesting payment.
Please note that if the invoice is not paid the Trust will request the services of a debt collection agency to recover the outstanding balance.
This also applies if you terminate your contracted post and you only work on the bank.
WILL JOINING THE SCHEME AFFECT MY ABILITY TO CLAIM WORKING FAMILY TAX CREDIT?
It might but each working family situation is unique therefore if applicable you should always
take advice regarding Working Tax Credits.
Tax credit information is available at www.hmrc.gov.uk/calcs/ccin.htm or by calling the helpline on 0845 300 3900.
WILL THE SCHEME AFFECT MY APPLICATION FOR LOANS AND MORTGAGES?
The lender will write to the Trust for a reference. We will give the lender details of your pre
sacrifice salary (which is your salary before the salary sacrifice reduction), which the majority
of lenders will accept. For the benefit of other lenders we will also show separately the annual amount of each salary sacrifice scheme you may have.
For example if your pre salary sacrifice salary is £20,000.00 per year and you have 2 salary
sacrifice schemes, one for the Car and one for the Voucher Scheme, the information will
look as follows:
Annual Salary £20,000.00 per year
Salary Sacrifice Car £3,500.00 per year
Salary Sacrifice Voucher Scheme £1,000.00 per year

Source: http://www.doksi.net

WILL JOINING THE SCHEME AFFECT MY NHS PENSION?
1995 NHS PENSION SCHEME CURRENT ARRANGEMENTS
If you are a member of the 1995 NHS Pension Scheme your
pension benefits are based on your best year of the last 3
years prior to retirement. This means that should you have the
reduced salary in force when you come to retire or receive
benefits, these benefits will be affected. You need to decide if
this could apply to you. Nearer your chosen retirement date
you may consider leaving the salary sacrifice scheme.
2008 NHS PENSION SCHEME CURRENT ARRANGEMENTS
If you are a member of the 2008 NHS Pension Scheme your
pension benefits are based on an average of the best three
consecutive years in the last 10.
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WHAT IMPACT WILL THIS HAVE ON MY PENSION UNDER THE
PROPOSED PENSION SCHEME BEING INTRODUCED IN 2015?






The new NHS Pension Scheme will be introduced from
April 2015
It is a career average scheme rather than a final salary
scheme
You accrue pensionable earnings for every year you
participate in the NHS Pension Scheme
Your pension will accumulate in 1/54ths of your pensionable earnings.

Further information on the New NHS Pension Scheme can be
found on NHS Employers Website.
STATE PENSION
The State Pension is a contribution-based benefit and the Additional State Pension is an earnings-related benefit and as
such one or both of these could be affected by joining the
Scheme.
The State Second Pension forms part of the State Pension.
Salary Sacrifice can affect the State Second Pension as the
value is calculated based on your annual pay after sacrifice.
Further information on the State pension can be found on the
UK Government website.

Please note this booklet is a guide only and provides information about the scheme. It is not the terms and
conditions of the scheme or the scheme rule book. Employees should always seek independent advice if
unsure about the suitability of the scheme to them.

Source: http://www.doksi.net

SCHEME BENEFITS:
Opportunity of leasing a brand new car
No deposit or credit check
Significant cost savings over providing a private car
Access to public sector discounts
Flexible periods of hire
Option to purchase at the end of the contract

ALL VEHICLES INCLUDE:
Fully Comprehensive Insurance
Mechanical and electrical repairs
Routine Servicing
Replacement tyres, exhaust, glass, excise duty
Breakdown and Recovery Service
Accident Management
Courtesy car - Accident Repairs

Knowles Associates
Total Fleet Management
Red Lion House
The Green
Great Bentley
Colchester Essex
CO7 8QG

Tel: 01206 255420
Fax: 01206 252211
www.knowlesfleet.com
quotes@knowlesfleet.com
Office hours
Mon-Fri 8am - 6pm
Sat 9am - 12pm