Fleet management specialist CBVC Vehicle Management is encouraging businesses to mitigate rising National Insurance Contribution (NIC) costs by adopting an electric vehicle (EV) salary sacrifice scheme.
In April, the employer NIC rate rose by 1.2% to 15% and the payment threshold dropped from £9,100 to £5,000. According to the Institute for Fiscal Studies (IFS), this could cost employers an additional £900 per employee each year, based on a median wage.
Michelle George, Commercial Director at CBVC, explains why the company is actively recommending EV salary sacrifice as a cost-saving strategy:
‘With employer NIC increasing, businesses are under growing pressure to manage rising costs. Introducing an EV salary sacrifice scheme is a smart, strategic way to significantly reduce your NIC bill – while also boosting employee benefits and delivering on sustainability goals.’
Salary sacrifice works by enabling employees to exchange a portion of their gross salary for a fully maintained electric vehicle. This lowers the employee’s income tax and NIC liabilities which also translates into lower employer NI contributions.
NIC employer savings can be significant
CBVC has calculated employer NIC savings across a range of popular electric vehicles.
| Vehicle | Employer NIC savings per month | Employer NIC savings over 48 months |
| Tesla Model 3 Long Range AWD 4dr Auto | £153 | £7,344 |
| Audi Q4 Sportback 45 Black Edition | £126 | £6,048 |
| Volkswagen ID.4 | £99 | £4,752 |
Examples are based on a 40 year old, 40% tax payer with insured vehicles on a 48 month, 40,000 mile contract. Quoted 08/04/2025.
CBVC is seeing strong uptake of its EV salary sacrifice solution across both new and existing customers. Earlier this year, the scheme was rolled out at Champions (UK) plc [insert link when live on CBVC site] and now forms a key part of its HR benefits package and Environmental, Social and Governance (ESG) agenda.
Industry data from the British Vehicle Rental and Leasing Association (BVRLA) supports the uptick in salary sacrifice; its April Leasing Outlook Report reported 61% year-on-year growth for the funding method.
Pictured: Michelle George, Commercial Director, CBVC Vehicle Management
Editor notes:
About CBVC Vehicle Management:
CBVC Vehicle Management is a dynamic fleet management company based in Burton upon Trent in Staffordshire. The company has been expertly managing fleets for more than 20 years, offering customers class leading and innovative fleet and leasing management – all underpinned by personal service excellence.
With expertise in leasing and a focus on new technology, the expanding business is also perfectly positioned to support customers in the transition to a decarbonised electric future.
For more information about CBVC please visit Home – CBVC Vehicle Management
