Car salary sacrifice on £120,000: the true monthly cost
On £120,000, a £45,000 electric car on a £600 a month gross sacrifice has a true cost of about £318 a month, a saving of about 47% against paying from taxed pay. Source: gov.uk.
Figures for 2026/27 · England, Wales and Northern Ireland · last reviewed 2026-09-06
How much does a salary sacrifice car cost on £120,000?
About £318 a month in true cost, a saving of about 47% against paying from taxed pay. The headline sacrifice is £600 a month, but that is gross pay. On £120,000 you sit in the £100,000 to £125,140 Personal Allowance taper, where the marginal rate is 60% plus National Insurance, so giving up that pay avoids income tax and National Insurance at your marginal rate. Your take-home therefore falls by only £228 a month. The electric car is then a Benefit-in-Kind, adding £90 a month of tax, so the true cost is £318 a month.
A month
Gross sacrifice (headline)
£600
Take-home drop
£228
Benefit-in-Kind tax added
£90
True monthly cost
£318
Saving versus taxed pay
£282
Over a year that is a saving of about £3,384 against paying the same £600 a month from taxed pay. The EV salary sacrifice calculator lets you change the salary, the car price and the monthly sacrifice.
How much does a salary sacrifice car cost on £120,000?
About £318 a month in true cost for a £45,000 electric car on a £600 gross sacrifice. Your take-home falls by £228 a month and the Benefit-in-Kind tax adds £90, so you save about £282 a month against paying from taxed pay.
What saving rate do you get at £120,000?
About 47% versus paying the same £600 a month from taxed pay. At £120,000 you are in the £100,000 to £125,140 Personal Allowance taper, where the marginal rate is 60% plus National Insurance, so the sacrifice avoids tax and National Insurance at your marginal rate, and after the small Benefit-in-Kind tax the net saving is about 47%.
Does the salary have to be exact?
No. This page uses £120,000 as a round figure. A different salary changes the marginal rate and so the saving, and a different car price changes the Benefit-in-Kind. The calculator takes your own numbers.
Is the Benefit-in-Kind tax included?
Yes. The electric car is taxed on 4% of the £45,000 P11D value for 2026/27, which is £1,800 a year of taxable benefit. The true monthly cost shown already adds that tax to the take-home drop.
Sources & Rate Verification
Rates verified against official statutory guidance on 6 September 2026.
Information, not financial advice. Figures use the published 2026/27 rates and one representative £45,000 car on a £600 a month sacrifice, and assume your employer offers salary sacrifice and passes on the full amount. Check your own scheme before acting.
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