Dr James, 0s:

When it comes to purchasing a car. We've all heard of those pesky acronyms PCP, HP, PCH and all the other various ones that are out there, but we have no idea what the heck they mean. So Ammar Farishta is here with us today, car finance expert, to discuss our car finance options, so we know that we're getting the best deal, particularly whenever it comes to purchasing a car for us dentists, and sharing with us how we can make the most of our limited companies in order to ensure that we're going to get a car deal which is worthwhile. Let's talk car finance, because this confuses the absolute heck out of everybody out there, not least myself, and we want Dennis to be able to get the best deal. So where is a good place to start, Ammar? What is the first decision that we need to make? Because I know that you and I talked off camera and you said it was buying versus leasing. Is that a good place to begin? Absolutely.

Ammar, 45s:

Yeah. So, James, the very first thing that you and your listeners need to be considering, first and foremost, is how are you going to be acquiring this asset? And a car or vehicle is exactly that. It is an asset for you to be utilised. So you can acquire this asset in one of two ways. So you can either buy this or you can lease it. So I'll explain the difference very briefly between the pair of them. So when you're buying a vehicle on finance, essentially you are making your monthly payments with the intention that at the end of that period of payments, ie at the end of that agreement, you can then go ahead and choose to own that vehicle and that vehicle is entirely yours. So that is the concept in terms of buying a car on car finance. The other aspect is leasing it. So leasing is almost like a long term rental. So essentially, you are putting down some sort of down payment and then after that, you're making your monthly installments for the duration of the contract that could be two, three or four years and at the end of it you simply give the car back. You are not owning that asset. So that's essentially the first decision that people do need to make. I'm mindful that there are, I'm sure, a number of factors that people will probably consider when it comes to either buying versus leasing. So one thing they may want to consider is whether they're going to be taking this out personally or whether they're going to be taking this out through their business. So a very good idea is to have a conversation with your accountant in terms of what is the most efficient way to be doing this from a tax perspective. For a lot of people, leasing generally tends to work from a business perspective, so if they are doing things from their business, they would want to be doing the leasing route. That is usually the better way to do it, whereas if those people who are rather acquire the vehicle through a personal place or from a personal perspective, then they're better off buying it through car finance. So these are sort of a few things maybe to consider.

Dr James, 2m 43s:

I see, and just to make that crystal clear better off from the point of view of the numbers in a tax perspective.

Ammar, 2m 47s:

right, Absolutely yes. So numbers from a tax perspective and what you're ultimately paying for that vehicle as well as from a tax perspective, it's both.

Dr James, 2m 55s:

I see that's the juicy part, and you know what? We're going to get into that very, very, very soon, because I know that that's super relevant to dentists. Just before we do that, let's talk about buying versus leasing, because this is another thing that I see people chuck around a lot, but not everybody understands how this works, so we could probably do a little bit of an explainer on this front. Pcp, pch, bch, hp all these abbreviations what the heck do they mean?

Ammar, 3m 19s:

All right. So there's a lot of acronyms out there in the car finance world and I appreciate it can be confusing, so I'll break it down for you, right? So, as I mentioned earlier, you've got these two options buying or leasing. So let's focus on the buying bit to begin with. All right, so if you're looking to buy a vehicle, you've got two potential options in terms of finance. Okay, so one is what's known as a PCP, or a personal contract, or a personal car purchase With a PCP. The way that it works is you have got, first of all, a down payment that you're putting down. Now, in the car finance world and you'll find this with a lot of people who are selling vehicles in the industry they call it a deposit. But it is a bit of a misnomer to call it a deposit, James, because the reality is you're not getting that money back, right? It's not like when you're renting a house and you put down a deposit and then at the end of your contract, when you're leaving, depending on the state of the house, you get your deposit back. It doesn't work like that. So you're not getting that money back. So, strictly speaking, that payment is what's known as a down payment. So, of course, the more that you're going to put down, the lower your monthly payments are going to be. So you've got that element of a down payment, which is first and foremost in a PCP. You then have your equal monthly installments, which you then pay over the duration of your agreement and the key term here is the word agreement, and I'll get back to that in just a moment. So you're making your your equal monthly installments, or equal monthly payments, over the duration of your agreement. Let's say, traditionally speaking, it's around 48 months or four years. So you make your equal monthly payments and then, at the end of the agreement, you've got three options, okay. So option one is, if you would like to go ahead and own the vehicle, you pay what's known as a balloon payment, all right, or the guaranteed future value. So you pay that, and you can pay that either in one lump sum. Or if you wish to refinance that, you can do that as well in order to acquire the vehicle, and that vehicle is now yours to do with in whatever way, shape or form you like. So that's option one. Option two is you can give the vehicle back to the funder. So whoever you've got your finance agreement with you can tell them to say that, look, I no longer now want to utilize this vehicle. I'd like to be able to give it back to you, and you can do that as well as an option. So that's option two, or option three in all of this is you can go ahead and do what's known as either selling or part exchanging your vehicle. So let's say, for example, you've got a Mercedes E-Class and you'd like to upgrade to, let's say, a BMW 4 Series. Depending on your perspective, that may be an upgrade or a downgrade, depending on who you speak to, but let's call it an upgrade for argument's sake, all right. So if you're going to be upgrading to a 4 Series, you can then choose to say to the person that, or to the dealership that you're buying that 4 Series on to say, hey, I would like to give this Mercedes E-Class, please settle the outstanding finance for me, and if there's any remaining equity within that vehicle, I'd like to utilize that as a down payment towards my BMW 4 Series. So these are the three options that are available on the table for those who are going down the PCP route and, as you can see, James, there's a lot of flexibility when it comes to PCP, there's plenty of options. You don't have to just simply own the vehicle, and there's a lot of options With regards to the agreement. Now, if you remember, I mentioned this word agreement, and the reason I call it an agreement is because you can get out of that agreement at any time, and it's actually pretty straightforward. So let's say, for instance, that you've got this Mercedes E the latest settlement figure from your finance company. So they will tell you exactly how much you owe on finance at this moment in time, and you have a look at what the value of your vehicle as it is in at that point in time, ie 18 months from now, and you compare the two and assuming that the amount that you, that the value of of your vehicle, is higher than what you owe to the funder, you're in a great position. So you can sell off your vehicle, you utilize that money to pay your outstanding finance and you've got some money left over. So that is what's called positive equity. So you can do that as well at any stage if you want to, and you're not penalized for that. So there's no additional payment to be had in regards to that. So it's actually a very flexible way to do things. So that's just in regards to a PCP as well. So just in general, in overall headlines PCP lower monthly payments in comparison to an HP and we'll talk about HP later on so lower monthly payments. Number two a lot more flexibility in terms of when you'd like to be able to get out of that agreement and I suppose with number three is that you can give the car back if you're in a position of negative equity, which is the other way around. So if the value of your car is worth less than what you owe to the finance company, that means even after you sell it, you still owe a little bit of money back to the finance company, which is not a great position to be in. That's what's known as negative equity. You can avoid that entirely by just simply giving the car back to the funder and not paying anything additional on top, as long as you're within your mileage allowance and there's no excess wear and tear on the vehicle. So I hope that makes sense on the vehicle. So I hope that makes sense. I know I've chucked a lot at you at this moment in time, but I'd love to hear a little bit more to see if there's anything else coming from you on this 1000% following so far and you've just pulled this stuff out of the ethereal massively because I've heard of PCP but I had no idea how it works for those specific arrangements.

Dr James, 8m 58s:

So yeah, I'm interested to know more about HP higher purchase, to compare and contrast.

Ammar, 9m 6s:

Yeah, absolutely so. Let's have a look at a higher purchase. So the way that a higher purchase works is, again, you have what's called a down payment or a deposit that you put down, and it's the same principle with a PCP. So the more of a down payment you put, the lower the monthly payments are going to be in your agreement, and again, that agreement could be 24, 36, 48 months long. Traditionally speaking, these are 60 months long the HP agreements that are usually a little bit longer. Now, with HP agreements, the way that it works is, having put down that down payment, you're then making your equal monthly installments over the duration of your agreement Again exactly the same, whether that's 36, 48 or 60 months and then, at the duration of your agreement, again exactly the same, whether that's 36, 48, or 60 months and then, at the end of the agreement, you've paid off the finance completely. The car is yours to own, you owe nothing back to the finance company and the vehicle is yours to do with in whatever way, shape or form you please. So that's what an HP is in essence. So, as you can see, there are fewer options at the end of the agreement because, well, the car is just yours, there's nothing else. You can do whatever you wish to do after that with the end of the HP. So it's a bit simpler in that regard. The monthly payments, of course, are higher because you don't have a balloon payment at the end of an HP agreement. So, because you're paying all of that money off and you owe the finance company nothing, at the end of it there's no balloon payment, which means your monthly payments, of course, are going to be substantially higher compared to getting a PCP. So that's the key difference there. One more thing to bear in mind is that, with an HP, you can get them on any type of vehicle. Ok, so any type of vehicle, you can get an HP. A PCP, though, is restricted to vehicles which are up to five years old. So it cannot be anything older than five years old. If the vehicle is older than that, you can only get an HP on that vehicle. You wouldn't be able to get a PCP.

Dr James, 11m 5s:

And you know what, I guess the next question that I was curious to ask, which you kind of partly answered in what you just said when does it make sense to get a PCP versus an HP? Because from hearing until you said what you literally just said, what was playing in my head was doesn't it just make sense to get a PCP every time?

Ammar, 11m 20s:

Absolutely. Yeah, it does. And, to be very frank with you, 95% of my finance customers go for a PCP because it just makes so much more sense. You're making lower payments, you can get out of it whenever you want to, and it's actually a very, very simple and easy way to be financing a vehicle. Go for an HP are, of course, those who would like an older vehicle. They are also people who perhaps would like something which is a little bit more simple, so they don't want to have to worry about things like potentially negative equity because they're making higher monthly payments. So the chances of them being in negative equity are significantly less and they just want things to be a little bit more simpler. And the other thing is that they're potentially looking to keep the vehicle long-term. So they know that, look, I've got, let's say, an Audi A4. I'm looking to stay with it for the next seven to eight years. For argument's sake, you know it's only a year or two old and I'd like to keep it for the long-term. And so they don't really need to be concerned about potentially switching the vehicle in two to three years time, because that's not really something they want to do. So for them, an HP may make more sense, but yeah, for the vast majority of people a PCP makes way more sense.

Dr James, 12m 35s:

There we are Understood. Thank you so much for that. All right. Well, now that we've boxed off the whole buying side of things, I guess the next natural progression is more the leasing side of things off the whole buying side of things.

Ammar, 12m 46s:

I guess the next natural progression is more the leasing side of things. Yeah, absolutely yeah. So let's have a look at leasing. So with leasing it is essentially a long term rental. That is what a lease is. So you are putting down again some sort of a deposit or down payment, right? So again, you're not getting that money back. So the bigger that down payment, the lower the monthly payments are going to be. Now it's slightly different with leasing compared to buying, in the sense that with your down payment it's not a variable amount that you generally tend to put. So what I mean by this is, for instance, with buying, you can put down, let's say, two grand, three grand, four grand, five grand. However much you'd like to put down. With leasing it translates into the amount of monthly payments you're going to be making up front. So let me explain that in a little bit more detail. So let's say the monthly payments, to make the figures nice and simple, are £500 a month. Okay, that is how much it's going to cost you to get a particular vehicle. If it's £500 a month, you can put a certain amount up front. So it's what's known as, for example, six months initial payment or a nine months initial payment. So let's say, if it's a six months initial payment, that means £500 times six. You're paying £3,000 up front, followed by your monthly installments of £500.

Dr James, 14m 3s:

Oh, I see, and just to jump in there, that doesn't buy any mitigation in terms of when the successive payments are expected from you. So, for example, you pay the six times 500 upfront and that doesn't give you six months of rent free.

Ammar, 14m 16s:

No, it doesn't. It doesn't do that. However, if you do want to, let's say, put nine months initial instead of six months, your monthly payments aren't going to be 500 anymore, it'll be more like 480. So it'll drop a little bit and so instead of making nine payments of 500, you're making nine payments of 480 instead. So that's what you're doing there, so you can increase the initial payment, and that makes your monthly payments lower. And you're doing there so you can increase the initial payment and that makes your monthly payments lower. And you're only paying that nine months, let's say, of initial payment up front, based on the new calculation that they've got there for the initial payments. So the way that it generally tends to work with leasing is that when you have some sort of a quote that comes to you, it'll be in the form of, let's say, six plus thirty six. It'll be in the form of, let's say, six plus 36. It'll mention that. So, six meaning the six months initial payments, 36 meaning the 36 month agreement, you're making 36 months.

Dr James, 15m 8s:

And we don't see that money again, we don't get it back.

Ammar, 15m 10s:

Is that right, that's correct you don't get that money back. So at the end of the contract and I say contract as opposed to agreement, because with leasing it's a lot more stringent so you make your monthly payments over the duration of the contract, let's say three years, and at the end of the 36 months or three years you simply give the car back and that is the end of it. You can then get something else.

Dr James, 15m 33s:

I see, and I definitely don't want to derail the conversation too much because obviously we want to stay on track, but I guess what makes sense from the leasing perspective is that the repayments tend to be a lot less than on the buying side of things, and that's the incentive. Great question.

Ammar, 15m 48s:

So, when it comes to leasing, that does depend on whether you intend to go down the personal route or down the business route. So you have what's. So there are two finance products here. They work identically. The key difference is one is with VAT, ie the PCH or personal contract hire, and the other is your BCH, the business contract hire. So the quote that you'll be given for each will be with or without VAT dependent. That's pretty much the only difference when it comes to leasing.

Dr James, 16m 14s:

Oh, okay, Understood. Well, perhaps we can cover that whenever we talk about tax a little later on, but I'm glad that I asked. Anyway, we were talking about BCH and we didn't do BCH yet. Did we In full at least, or did we With BCH?

Ammar, 16m 32s:

So we haven't covered it in a whole lot of detail, so maybe I'll mention it very briefly at this stage, because I think it'll link nicely with the tax conversation we'll have later on. But, as I said, fundamentally the difference between the two is just the quoting. With and without VAT, the way that it works is identical, so there is your initial payments that you're making, you make your, your equal monthly installments, and then at the end of it, you give the car back. So it is the same whether you go down the PCH route or the BCH route. The key difference is just the VAT element of it. What's really important to recognize, though, is leasing in general, whether you go down the PCH route or the BCH route. So there's two things. Number one leasing only applies on brand new vehicles. So when you are leasing a vehicle, you'll be getting a brand new vehicle. So, traditionally speaking, manufacturers will release brand new vehicles at two stages in the year. So one is in March, which is when the, for example, 24, 25, 26 plates come out, and then you've got September, which is when the next new cars are then released. So that will be classed as 74, 75, 76, etc. Etc on the number place. So that's how you can distinguish between the two, but it's only on brand new vehicles. I know that there is slowly a movement that is starting on trying to get leases on used vehicles, but it's not a very popular product at the moment and it's a very, very niche market. But predominantly the leasing industry is there for brand new vehicles moment, and it's a very, very niche market, but predominantly the leasing industry is there for brand new vehicles. That's what it's all about, and I suppose the advantage with that, in a nutshell, James, is with leasing, you're getting a brand new vehicle, so the chances of it breaking down are significantly less and you're going to get a lot of things included within your monthly payment. So, to answer your question about whether the payments are higher on a lease compared to a used vehicle, the payments will be a little bit higher, and I'll explain to you why in a couple of ways. So, first of all, it's a brand new vehicle in comparison to a PCP, where a lot of people generally tend to get it on used vehicles. You can do it on a brand new as well, but on a used ones is what people are comparing it with, and so, as a result, because you're getting a newer asset, it's worth more, and so the lease payments will be a little bit higher. The other thing, though, is that you're getting a lot of things included within those monthly payments. So, within leasing, you're going to get manufacturer's warranty as standard, and you do get your road tax, which is also included as standard. If you'd like to have a service plan included, you can do that as well, and with that, of course, you get the complete peace of mind. So you get your annual service included. If there is an MOT which is required because, of course, mot on vehicles is only due after the first three years are complete you get an MOT included. Things like tires and glass as well are also included. So there's a lot of things that are included within a lease payment, which is why those payments are a little bit higher, but then again, it gives you complete peace of mind in that regard. So if anything were to go wrong, you're covered by your funder.

Dr James, 19m 34s:

Let's talk about the tax considerations, because this is super valuable for dentists. So I guess there's two high level approaches, really. The first one would be owning your car through a limited company, and then the second one would be owning a car through your personal name, and there's pros and cons to each. I've got that right, haven't I?

Ammar, 19m 54s:

Yeah, correct, correct, that's right. Yep. So, when it comes to the tax, efficient way to be able to get this particular asset, and just bearing in mind that vehicles, as an asset, are a depreciating asset, so they do go down in value month on month, year on year, they will continue to depreciate. So we need to be quite mindful and considerate as to how we'd like to be able to acquire this for the best tax reasons, and consider as to how we'd like to be able to acquire this for the best tax reasons. Now, I'd like to be able to caveat. This at this stage is just to make sure that, if you are looking to consider this as a route, it's always best to speak to your accountant first and foremost, just to be able to get the best possible advice in terms of what's best for your situation, because everybody will have a unique situation. Having said that, though, a few things to consider when it comes to, for instance, with leasing a vehicle, and let's discuss that to begin with. When you are leasing a vehicle, the advantage here as a business owner, is that you can deduct the lease payments from your profits in order to reduce corporation tax. So, as most people, I'm sure are aware, your corporation tax is based on the profits that you have got within your company and that is, of course, deducted from any expenses. So any expenses are removed and anything remaining is, of course, the corporation tax. You can reduce your corporation tax significantly by adding that lease payment as an expense, so that's something that you can potentially do if you're going to be leasing through the business. So it's a very efficient way to be able to reduce your corporation tax bill. I'm very mindful of the fact that it is variable, dependent on the type of vehicle as well. So you can deduct the full lease payment if you are an electric vehicle, the full lease payment if you are an electric vehicle. If you're leasing an electric vehicle, you can deduct 100% of the lease payment as an expense. Otherwise, if it's what's known as an ICE vehicle or internal combustion engine vehicle, you can deduct 85% of the lease payments as far as an expense is concerned. So there is a slight difference there to be mindful of. The other element in all of this is the VAT element as well. So with when it comes to these monthly payments that are paid, you've got a VAT element which is included within the lease payment. So, let's say, for example, on a BCH you've got, let's say, £400 plus VAT. So with the £400 plus VAT, the VAT element of it you can reclaim back. And again, that just depends on whether you can prove that the vehicle that you're utilising is purely for business purposes. Only If it is purely business you can reclaim 100% of the VAT. If it's going to be both personal and business, you can claim half the VAT back. So that's how it works on that front as well.

Dr James, 22m 46s:

Just curious to know. Obviously dentists aren't VAT registered, so they'll certainly the vast, vast, vast majority of the time. So I'm just curious to know that VAT will be effectively the price will be the price plus the VAT. Then there'll be no, there's no tax moving around. They can do in that front right.

Ammar, 23m 5s:

Yes, you're quite right, and it's interesting you say that, because even those in the in the care industry, for example, face the same issue, in the sense that they're not generally VAT registered or they can't claim the VAT back because of the industry that they're in, so it's a similar predicament. But, yeah, you're quite right, so that's not something that they can do, although the very first thing that was mentioned around deducting the actual lease payment as an expense is something that they can do as well, so that's not an issue.

Dr James, 23m 28s:

Excellent Limited companies. Anything more to say on that front?

Ammar, 23m 36s:

Or have we? Yeah, so I think the other thing that they just need to consider is around, um, perhaps around class 1a national insurance, and that's something that you need to think about if you're going to be an employer, um, so, again, there's stuff to do with things like salary sacrifice schemes that they may need to consider. We can talk about that, uh, perhaps a little later on. Uh, you know if and when it comes up in the conversation. But, yeah, that is also something for uh employers to consider if they want to go down that route too.

Dr James, 24m 0s:

Talk about that, perhaps, a little later on, you know if and when it comes up in the conversation. But yeah, that is also something for employees to consider if they want to go down that route too Understood. And yeah, let's definitely talk about salary sacrifice. Again, it's something that we kind of have a vague awareness of as dentists, but maybe we just haven't had it spelled out what that is. But before we do that, we've really done a great job talking about limited companies and tax considerations there. How does that differ whenever it comes to owning these vehicles or certainly leasing these vehicles in a personal name?

Ammar, 24m 22s:

Yeah, okay, so with buying it. So just to clarify the question, I just want to make sure that you're comparing this compared to buying it in a personal name. Is that the comparison we're making here? Yes, yes, okay, fine. So buying it in a personal name if you're going to be going down the finance route, of course, because this is something that you're going to be doing personally and you're not going to be going down the business route deducting those payments is not necessarily something that you would be able to do, because that is an asset that you've now bought, as opposed to lease, so there is a bit of a difference there. What we also need to be mindful of is that the payments in general will be almost similar. If we consider the difference between when you are claiming your lease payments back on the business versus if you were to do it in a personal name, when you wouldn't be able to do that, the savings that you're making then is considerable. In all of this, what we also need to be mindful of, James, is that, regardless of whether we take the vehicle out via the lease route on a business, or if you were to buy it in a business name, you would be subject to what's called a benefit in kind tax. So this is just something for dentists to be aware of. So if they're going to be going down the lease route and if you're going to be having this vehicle on lease, you would have to pay what's called a benefit in kind tax, because that is a benefit that you are having, ie driving a brand new vehicle. Now, a benefit in kind tax will vary depending on the type of vehicle that you have. Again, the government have stipulated that it is far more beneficial for you to have an electric vehicle, and at this moment in time, as of recording, right now, it's at two percent. That is due to go up in the years to come, so three, then four, then five percent in the years to come. It is similar for those vehicles that have an emission standard or a co2 emission standard of 50 grams or below. So most plug-in hybrid vehicles can also benefit from this as well. Having Having said that, the banding then goes up accordingly. So if it's doing more than 50 grams but below 250, you're getting taxed at a 5 or 6% rate, and then with internal combustion engines it's a lot higher. So for most individuals, if you're going to be going to go down this route of having a vehicle in your business name. The best way to be able to do it is making sure that you get a brand new electric vehicle via business lease. It is the most tax efficient way to do it and it just makes the most sense. And I appreciate you've got those individuals out there who are traditional petrol heads and love the roar of that engine and I totally get that. But if you're thinking of this purely from a financial perspective, getting an EV makes the most sense in terms of purely from a financial discussion.

Dr James, 27m 23s:

Yeah, of course. Yeah, of course, because this can be. Dentists are very interested in when they can go limited and when they can go, you know when they should remain as a sole trader, and actually a lot of the nowadays it's actually a lot more marginal. Is that call versus what it used to be a long time ago, as in? Obviously it's determined by the amount of money that you bring in and obviously the amount of profit that you have, as well as in before expenses or after expenses, rather uh. But certainly one thing that make you, can make you swing the other way or swing one particular way, is knowing this about limited companies and electric cars, because it just made to have a tax deductible well, virtually tax deductible car, I get there's a two percent benefit in kind. To have a virtually tax deductible car is crazy because it in most situations you basically double your money. Money in a limited company is worth double what you have in your personal name a lot of the time because of tax, not always, of course, but listen, just worth mentioning. Let's talk salary sacrifice, because I know that was something we touched upon.

Ammar, 28m 25s:

Yeah, absolutely so. Salary sacrifice schemes are a very unique way for employers and employees both to benefit from the tax savings that are available on getting electric vehicle. So I'll explain how it works. With a salary sacrifice scheme provider, an employer will set up or have this conversation with the salary sacrifice or self-sac scheme providers to be able to set this up for their company, and they're essentially acting as a middleman between the salary sacrifice scheme company and their employees. So they will have a range of vehicles for the employee to choose from. The employee can then choose that particular electric vehicle that they would like to take, and the way that it works is that the lease payments will come out of your gross salary. So let's say, for argument's sake, you've got a gross salary and keep the number simple at this stage of, let's say, for example, £3,000. So if you're getting £3,000 a month and let's say your lease payments are £500. So your lease payments will come out of your gross salary before it is taxed. So you're then being taxed on the £2,500 that you are grossing after the lease payments and you're only taxed on that and not on the £3,000. So you save on the tax there. So that's the benefit for those who are for the employee and for the employers. You are paying less national insurance as a consequence as well. So what happens is is you've got a saving for the employer. You've got a saving for the employee. And not only that what a lot of companies have found in this day and age, James, is that when it comes to this idea of salary sacrifice, they're actually getting better employee retention. People want to stick around for longer because they've got a fantastic perk in the sense that they're getting this brand new EV that they can drive around, and it's a fabulous perk to have. So that's really really good for staff retention as well. So if you've got someone who's working with you who you think you would like to be able to retain in the long run, this is actually a really, really nice way to do it. One thing to also bear in mind just with South Sac schemes is they can be pretty useful because you can have insurance included within the lease payments as well, which is pretty nifty. So traditionally with leasing, you just have to be mindful of how you fuel your vehicle or charge it and your insurance, but when it comes to South Sac, you can have insurance included in that as well, you could also get included insurance for a secondary driver as well, so that is really really nifty. So it's a very useful way to be able to try and get people into a brand new EV and keep them in your company for longer.

Dr James, 31m 9s:

Nifty is the word. So let's say, to use those numbers that you used just then so let's say someone's bank getting paid 3,000 a month or at least they were before the salary sacrifice scheme. So that times that by 12, 36,000 in a year, does that mean that if they had 500 quid salary sacrifice let's just do the math really quick here 2,500 times 12. Let's just see what we got here 2,500 times 12. So their salary effectively becomes 30 000 a year that's correct. That's how it works yep salary effectively becomes 30 000 a year. So what that would mean is that, yeah, that's just what they earn on paper, or is it that they earn 36 000 on paper but then they have this tax deductible little bit of money that comes off the top? I'm just curious, because that would it would make a little bit of difference whenever you get up to the like various tax bands and things.

Ammar, 32m 0s:

I'm just wondering yes, yes, it does, uh, and and your tax band is something to consider to be fair. So one thing that you need to bear in mind is that if you're right on the border, uh, of, let's say, between 20 to 40 percent for argument's sake, let's's make it simple so if you're right on the border, it's in your interest to make sure that you get an EV which is of your choice, but, of course, it's going to be having a lease payment that will get you back down to the 20%, so that you're taxed at a 20% rate as opposed to at the 40% rate. So that's a really good way to try and make sure that you're kind of in that bracket. There's been a really interesting uptake in the amount of business owners that are taking out what is arguably the most expensive EV at the moment, which are Porsche Taycans, and the reason they're taking this out is to try and maximize on those tax savings, because you've got the highest lease payments that you're making on those Porsche Taycans and you don't have to worry about the depreciation because you're giving the car back at the end of the contract. So that's not really something you have to worry about at night. So nice and straightforward that as far as leasing is concerned in South Sac. So, look, I think in all I think this is what I would summarize as far as business owners and South Sac is concerned it's a really good way to try and make sure that you, as an employer, are reducing your tax bill, your employees are reducing their tax bill, of course, and there's very, very simple ways to be able to get involved in terms of speaking to a SALTSAC provider to be able to set that up for you. So, as far as I'm concerned, and maybe just to perhaps round things off here, what would be really useful? If anybody would like to get some further information, advice, support, whether that be financing a used vehicle or whether you'd like to be able to lease a brand new one, you can reach out to me personally. I am available on LinkedIn, Ammar Farishtey. Just look me up on LinkedIn. It's the easiest way to get a hold of me. Otherwise, I'm available on Instagram, facebook and TikTok as well. Through Remora Vehicle Leasing, which is my vehicle leasing business as well, I'm so happy to provide support as far as individuals are concerned.