Hi I am after some advice regarding the NHS salary sacrifice car scheme, which basically gives people to chance to get a personal lease car with tax savings. I have been using this scheme for a few years now, they are usually either2-3 years the leases. Each NHS trust seems to use different lease car companies.
On my contract for my current one says there’s an early termination fee which in year 1 is normally around 5x the monthly payment, then 3x for yr 2, the 1x for last year. I asked a few years ago if i could send my car back to replaceit for a different one, they said fine. So i recently tried to do that so i ordered a new with the NHS lease company my trust uses and my car is with now, but they immediately cancelled it. I asked them why and they said you can't cancel a salary sacrificecontract during it unless you have had a Signiant lifestyle change like having a baby or getting divorced. They referred me to this HMRC page https://www.gov.uk/guidance/salary-sacrifice-and-the-effects-on-paye , they said it was a HMRC rule and not theirs. I knew i would have had to pay the exit fee to change my car earlier but i didn't mind that.
I used to work at a different NHS trust who used a different lease company who i used for a couple of years, when there my colleague asked them if he could upgrade early to replace the car he had with them, they said yes as long as hepaid the exit fees. So he did and no problems with getting it swapped he ordered it with no problems. I asked the NHS lease company from the other trust recently if they still allow this and whether they have the same rule as my current one with the HMRC ruleand they said yes they still let you and don’t have that rule.
My query is why do they have this rule i appreciate the tax saving for the car scheme but it’s supposed to be a personal one so i should be able to replace my lease car at any time as long as i am willing to pay the exit fees which iam.
Also why is it the 2 different lease companies have different rules as i believe each trust can only use 1 company at a time so i can't choose the other one that does let you upgrade earlier? So i am very frustrated that i can't changemy car earlier when i was hoping to especially when i was under the impression I would be able to.
Any advise or help would be appreciated.
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