At the Electric Car Scheme, we are here to support you with all your payroll and reporting requirements. This article covers what payments and invoicing the employee and the company can expect to receive from us as well as all the different reporting documents the Scheme will provide, all to help manage payroll.
You can find all Electric Car Scheme invoices and payroll reporting in your Employer Portal. Please bear in mind that invoices from the car provider will come directly from them and not ECS.
This article includes information on:
- A typical month with The Electric Car Scheme
- The Scheme reports
- Employer Invoices
- Employer Cashflow and Payroll
- Draft HMRC documentation
- Employee Summary
- Additional reporting on request
- Notifying HMRC of the provision of the car as BIK
A typical month with The Electric Car Scheme
Start of month:
- We provide you with your ‘Scheme Reports’ (see below for more detail)
- If you’re new to the scheme, you’ll be invited to join our HR & Finance webinar to talk through the Scheme Reports in more detail and address any questions you may have
- You will receive an email from GoCardless about your direct debit for our Administration Fee
- You will receive information from lessors and/or subscription providers about the monthly car hire costs and the payment of their invoices
End of month
- Our Administration Fee is taken via direct debit
The Scheme Reports
We provide you with three sets of documents on our Employer Portal:
Employer Invoices
We provide a PDF with the following:
- A summary for all cars ordered and delivered under the scheme, including:
- invoice for Administration Fees (‘The Electric Car Scheme fee’) and total amounts of any other charges to be paid by company (e.g. home charger installation fees, broker fees)
- breakdown of total VAT reclaims (to help with VAT reclaims for VAT-registered companies, and more information is here: https://www.gov.uk/reclaim-vat/cars)
- cashflow summary
- A breakdown of VAT reclaim for each car ordered and delivered under the scheme
- Cashflow summary for each car ordered and delivered under the scheme
Employer Cashflow and Payroll
We provide an excel spreadsheet containing:
-
for that month: payroll instructions detailing the gross salary reduction for each employee with
a car delivered under the scheme
-
for all months: payroll instructions detailing the gross salary reduction per month for each
employee with a car delivered under the scheme
- for all months: cashflow breakdown detailing the various amounts that are estimated as part of the scheme (e.g. VAT, National Insurance, BIK, tax) and evidencing the net zero impact to the company
Draft HMRC documentation
P46 (Car) forms:
Once an employee's car has been delivered, we provide draft pre-populated P46 (Car) forms for you. This form will need to be submitted in order for HMRC to account for the BIK and recoup monies due through the employee’s tax code (i.e. BIK tax). Companies providing a car through salary sacrifice, who do not pay tax on benefits through payroll, should fill in a P46 (Car) form to notify HMRC, when a car is provided or returned. The Electric Car Scheme makes this easy and will draft one for you to review for each employee that enters the scheme.
P11D forms
Each year, we also provide draft pre-populated P11D forms for you to submit to HMRC. These are prepared for the end of the tax year and include the BIK in the P11D submissions for the employee and the company.
This guide provides more information on how benefits can be taxed by HMRC: How is my tax collected?
Employee Summary
Each month, we email employees with a car delivered under the scheme with a PDF breakdown summarising their gross salary deduction (i.e. salary sacrifice) and other important information about their participation in the scheme (e.g. estimated BIK tax, estimated tax savings, total estimated savings, and savings to date).
Additional reporting on request
Please reach out to your contact at The Electric Car Scheme or to support@electriccarscheme.com if you require any additional reporting (e.g. an overview of employees that have shown an interest, information about cars on order or already delivered).
Notifying HMRC of the provision of the car as BIK
Once a car arranged under the scheme has been delivered, a P46 (Car) form will need to be supplied to HMRC. HMRC will then account for the additional benefit provided and will recoup all monies due (i.e. the tax on the BIK) through the employee’s tax code, typically when a P46 (Car) is processed, or through your P11D at the end of the tax year.
Companies providing a car through salary sacrifice, who do not pay tax on benefits through payroll, need to provide HMRC with a P46 (Car) when the car is provided and returned. We make this easy for companies and prepare a draft P46 (Car) form for you to review, amend and send in for each employee using the scheme.
This guide provides more information on how benefits can be taxed by HMRC: Tax credits and benefits