What is salary sacrifice charging? The complete 2026 guide

Most people have heard of salary sacrifice for pensions, or possibly for an electric car lease. Far fewer have heard of salary sacrifice for the electricity that goes into that car. That gap is costing UK employees real money every month, because charging is one of the few running costs that can also be paid for out of gross pay.

This guide sets out exactly what salary sacrifice charging is, how it works in practice, and what it means for employers and employees going into 2026.

The basic idea

Salary sacrifice is a contractual arrangement where an employee gives up part of their gross salary in exchange for a benefit, rather than receiving that amount as taxable cash pay. Because the amount is deducted before tax and National Insurance are calculated, both the employee and the employer save money compared with the employee simply paying the same cost from take-home pay.

Pension contributions and cycle to work schemes work this way. So does the electric car itself under an EV salary sacrifice scheme. Charging is the newer addition: instead of employees paying for electricity out of pocket and, at best, claiming back business mileage, the entire cost of charging is run through payroll as a sacrifice.

Why charging needed its own scheme

Company car and EV salary sacrifice schemes deal with the vehicle: the lease cost, insurance and maintenance. They generally say nothing about who pays for electricity. That has left most employees charging an EV in one of two unsatisfactory positions.

• Paying for all charging personally from taxed income, at home and in public, with no relief at all.
• Submitting mileage claims for business use only, using HMRC's Advisory Electricity Rate, while private charging is still paid from taxed income.

Neither option captures the tax efficiency that salary sacrifice already applies to the car itself. The Charge Scheme closes that gap by letting the cost of electricity, home, work and public, be sacrificed in the same tax-efficient way.

How it works

1. The employee charges as normal, at home, at their workplace, or on public chargers via the app and charge card powered by Plugsurfing, covering 76,000+ public chargepoints.
2. Charging activity is logged automatically through the app, rather than through manual expense forms.
3. The cost is converted into a monthly gross deduction, which payroll applies alongside existing salary sacrifice lines.
4. Tax and National Insurance are calculated on the reduced salary, so the employee only ever pays the reduced, net cost.

What it saves

The saving is simply the employee's marginal tax and National Insurance rate, applied to the amount sacrificed.

Tax band	Combined saving
Basic rate	around 28%
Higher rate	around 42%
Additional rate	around 47%

Employers also save employer National Insurance on every pound sacrificed, which is usually enough to cover the cost of running the benefit. You can model the actual saving for a given mileage and charging mix using the savings calculator.

Who it is for

Salary sacrifice charging makes sense for any employee driving a fully electric or plug-in hybrid company car, whether that car came through a salary sacrifice lease, a traditional company car scheme, or is simply their own EV. It is particularly valuable for the roughly nine million UK households without off-street parking, who cannot charge cheaply at home and instead rely on more expensive public charging.

For HR teams, it is a low-effort addition to an existing benefits package. For finance and payroll teams, it is a predictable monthly deduction rather than an unpredictable expenses bill. For fleet and procurement teams, it is a way to make electrification more attractive without changing lease providers.

What it is not

It is worth being precise about scope. Salary sacrifice charging covers the cost of electricity used to charge the car. It does not replace business mileage reimbursement, which has its own HMRC rules and its own product in Reimburse. The two run alongside each other: charging costs are sacrificed from gross pay, and any business mileage is reimbursed separately and compliantly.

It also does not require replacing an existing EV salary sacrifice or company car scheme. The Charge Scheme bolts on to whatever arrangement is already in place, so there is nothing to unwind and nothing for the leasing provider to change.

Setting it up

Employers need three things in place: a signed agreement covering eligibility and terms, a payroll deduction line, and a minimum wage floor check so gross pay never falls below the National Minimum Wage after the deduction. Everything else, from employee onboarding to ongoing support, is handled for you. The how it works page walks through the mechanics in more detail.

Next steps

If you want to see what salary sacrifice charging would look like for your organisation, book a call and we will talk through eligibility, payroll setup and the likely saving for your workforce.