Summer Budget: Tusker not concerned by spotlight on salary sacrifice
08 July 2015
Leading salary sacrifice vehicle provider Tusker has dismissed any concerns that car salary sacrifice schemes could come under increased Government scrutiny, claiming independent research has showed a clear taxation benefit.
"Salary sacrifice arrangements can allow some employees and employers to reduce
the income tax and National Insurance that they pay on remuneration. They are becoming
increasingly popular and the cost to the taxpayer is rising," read the official Budget documentation. "The government will actively monitor the growth of these schemes and their effect on tax receipts."
But Tusker's research, conducted by accounting expert PwC found: "Overall, the data shows that the salary sacrifice arrangement on its own can produce a tax-positive result," said the report. "Furthermore, after taking into account the additional tax payments from the company, the arrangement overall becomes tax positive and helps drive additional tax revenues to the Treasury by promoting sales, in-life management and disposal of incremental new cars into the economy."
"Not all salary sacrifice schemes are the same, and we see the provision of cars as very different because of the BIK element, and we can prove that," Tusker chief commercial officer Iain Carmichael told BusinessCar. "For me, salary sacrifice arrangements cover a massively broad spectrum - childcare vouchers, computer and phones to provision of a car through salary sacrifice and we see them fall into two distinct groups - some have BIK payable and there are others with no other taxation payable.
"With all others such as pensions, it's logical they have a look," he continued. "We'll be happy to engage with them and provide evidence that they are tax positive."
Carmichael said 70% of Tusker's salary sacrifice customers have never owned a new car before, and 80% of the firm's business is in salary sacrifice.