Around a third (32%) of respondents cite the ability to drive a better car as their reason for taking part in a company car scheme, according to research by Maxxia.
Its survey of 207 UK employees who are part of a salary sacrifice or traditional company car scheme or who receive a cash allowance, also found that 78% of respondents are unlikely to choose an ultra-low emission vehicle (ULEV) within a company car scheme if the tax incentives were to be removed.
The research also found:
- 92% of respondents view company car schemes as a positive benefit.
- 70% of respondents would consider opting out of their car scheme and taking a cash alternative if car tax levels were to rise further.
- 22% of respondents take part in a company car scheme because they find it easier than running their own car, and 23% do so because of the tax advantages.
- 32% of respondents who opt out of a company car scheme do so because they want the cash alternative, and 28% opt out in order to get a better choice of vehicle.
- 3% of respondents would currently choose a ULEV.
Gordon Calder-Jones (pictured), director at Maxxia, said: “Employee car and cash allowance schemes have been the target of changes to the tax rules by [HM Revenue and Customs] in recent months, so it was very illuminating to see how employees would react following the announcements made at the last Autumn Statement.
“What was clearly apparent was how finely balanced the decision regarding being part of an employee car scheme and opting out was, following the changes. While an overwhelming majority of employees still see the car as an attractive benefit, any further tax increases are likely to tilt the balance dramatically.
“It was also very evident that financial rather than environmental considerations were of the most importance for employees in making any kind of choice.”