89% use salary sacrifice to buy technology they could not afford outright


Almost nine in 10 (89%) respondents who have purchased a technology product through a salary sacrifice scheme would not have bought the product elsewhere because they could not afford to buy the item outright, according to research by Let’s Connect, part of Personal Group.

Its survey of 1,100 employees who have participated in a home technology salary sacrifice scheme, also found that 87% of respondents take part in the scheme because it is paid directly from salary.

Chancellor Philip Hammond confirmed that the range of benefits that attract tax advantages when delivered via a salary sacrifice arrangement would be limited in his Autumn Statement 2016. This excludes pensions, employer-provided childcare and childcare vouchers, bikes-for-work schemes, and ultra-low emission vehicles (ULEVS).

Any schemes entered into before April 2017 are protected up to April 2018, and company cars, school fees and living accommodation schemes are protected up to April 2021. The changes were legislated for through the Finance Bill 2017.

The research also found:

  • 72% of respondents take part in a home technology salary sacrifice scheme because it helps to spread the cost of major purchases, and 25% participate in these arrangements in order to save money on high street prices.
  • 64% of respondents use salary sacrifice arrangements to purchase iPads and tablets, 56% opt to buy laptops, 37% invest in a home entertainment system, and 18% buy smartphones.
  • 83% of respondents state that they would participate in a salary sacrifice scheme again in order to purchase home technology products.
  • 55% of respondents purchased a technology product via a salary sacrifice arrangement for education purposes, 19% bought their technology item to use while travelling, 52% used a salary sacrifice scheme to buy a technology product in order to use the internet, and 22% invested in technology for digital media and online gaming purposes.
  • 70% of respondents believe that the technology product purchased through a salary sacrifice scheme has helped them or their family improve their IT skills.

Sign up to our newsletters

Receive news and guidance on a range of HR issues direct to your inbox

This field is for validation purposes and should be left unchanged.

Steve Prevett, UK sales and marketing director at Let’s Connect, said: “Salary sacrifice remains an effective way for employers to reward their employees’ contribution and for employees to advance their own skills. Despite recent legislation changes, salary sacrifice schemes remain as popular with both employees and employers alike, particularly amongst millennials and generation Z. We are pleased that the government, after months of uncertainty [has] clarified their position and through the new legislation, continue to support salary sacrifice.

“Technology has become a fundamental part of everyday life but there is still a significant digital skills gap in the UK, we are currently lagging behind many of our European counterparts and rank only as the 16th most productive country in Europe. Salary sacrifice schemes have the potential to increase productivity through digital upskilling, increased education and improved wellbeing.”