This guide explains all three clearly so you know what exists, what applies to you and where to go next.
One thing to be clear about upfront: the term NHS car scheme refers to a specific Trust-administered lease. It is not a catch-all for every car benefit available to NHS staff. Salary sacrifice and the Motor Source NHS car discount programme are separate options, explained in full below.
The Three Ways to Get a Car as an NHS Employee
As an NHS employee, there are three main routes:
- NHS car discount. A negotiated discount on buying a new car outright. Available to all NHS staff with no Trust sign-up required.
- NHS car scheme. A lease run directly through your Trust. Payments come from your salary. Suited to staff who drive for work.
- NHS salary sacrifice. A pre-tax arrangement where part of your gross salary funds a car lease. Requires your Trust to have opted in.
| Feature | Motor Source NHS Car Discount | NHS Car Scheme | Salary Sacrifice |
|---|---|---|---|
| Who owns the car | You | NHS Trust | Leasing company |
| How you pay | Upfront or finance | Salary deduction | Pre-tax salary |
| BiK company car tax | No | Yes | Yes (2% on EVs) |
| Affects NHS pension | No | Potentially | Yes (2015 scheme) |
| Business mileage paid | Not applicable | Yes | No |
| If you leave the NHS | You keep the car | Exit penalty applies | Exit penalty applies |
| Available at all Trusts | Yes, via Motor Source Group | No, Trust dependent | No, CCS opt-in required |
| Typical saving | Average £7,500 off list | Varies by Trust | Varies by salary and car |
What is NHS Car Discount?
The NHS car discount programme is the most straightforward car option available to NHS staff with Motor Source Group. It is a negotiated discount on the purchase price of a new car, available to all NHS employees. No Trust sign-up. No HR conversation. No change to your contract. You buy a car at a discounted price and it is yours from day one.
Motor Source Group: the NHS car discount specialist
Motor Source Group is the UK's leading new car discount broker for NHS and public sector staff. NHS employees who buy through Motor Source Group save an average of £7,500 off the manufacturer list price, across all major makes and models. Motor Source Group works directly with manufacturer dealer networks to secure NHS pricing that is not available through standard retail channels.
"The NHS car discount is the option that works for every NHS employee, regardless of which Trust they work for or what their employment situation looks like. You save thousands off a new car and you own it outright from day one. No schemes, no penalties, no complications." – Steve, CEO , Motor Source Group
NHS car lease through Motor Source Group
Not every NHS employee wants to buy outright. Motor Source Group also offers an NHS personal contract hire option, a personal lease arranged directly between you and the dealer network. This is not salary sacrifice and requires no employer involvement. It gives NHS staff access to competitive lease rates regardless of whether their Trust participates in any scheme.
What buying outright includes
- Full ownership from day one
- No mileage restrictions
- No end of lease return conditions
- No early exit penalties. If you leave the NHS, the car stays with you
- All makes and models available, including used cars
- Finance available: PCP and HP applied to the discounted purchase price
You arrange your own insurance, servicing and breakdown cover separately. These are not bundled into a monthly payment as they are with the NHS car scheme or salary sacrifice.
What happens if you leave the NHS?
Nothing changes. The car is in your name. There is no penalty, no clawback and no employer notification required. This is the clearest advantage of the NHS car discount for anyone whose employment situation may change.
How to get an NHS car discount
- Browse deals. Search by make, model or budget using the NHS new car deals button above.
- Request a quote. Motor Source Group confirms the discounted NHS price and checks availability through their dealer network.
- Arrange finance if needed. Choose PCP, HP or a personal loan. The NHS discount applies to the vehicle price before finance is calculated.
- Confirm your NHS status. Verify your NHS employment. Motor Source Group handles this as part of the purchase process.
- Take delivery. Motor Source Group arranges delivery through the dealer network. Stock vehicles can often be delivered within days.
What is the NHS Car Scheme?
The NHS car scheme is a Trust-administered car lease. Your employer leases a car on your behalf, and the cost is taken from your gross salary each month. Because the payment is taken before tax, you pay less income tax, National Insurance and in some cases pension contributions. The car is not yours. At the end of three years, you return it.
The scheme is designed for NHS staff who drive as part of their role. It is separate from salary sacrifice, even though both use salary deductions.
Who provides it?
The largest national provider is NHS Fleet Solutions, the leading salary sacrifice car scheme for NHS and public sector organisations. NHS Fleet Solutions is operated through Northumbria Healthcare NHS Foundation Trust and runs under a Crown Commercial Service (CCS) framework. Your Trust must have opted into this framework to offer the scheme. CPC Drive (Tusker) is another provider you may encounter, depending on your Trust.
What the monthly payment covers
The NHS car scheme monthly cost is all in: the lease, fully comprehensive insurance, servicing, tyres, breakdown cover, road tax and Benefit in Kind (BiK) company car tax. BiK is the tax HMRC charges when your employer provides a car as a benefit. The rate is based on the car's CO2 emissions. Lower emissions mean a lower BiK rate.
Business mileage
If you use the car for NHS work journeys, your Trust reimburses you at an agreed rate per mile. This is one of the key advantages over salary sacrifice. It suits community nurses, district nurses, physiotherapists and other staff who drive between sites regularly.
What happens if you leave the NHS? This is the most important risk to understand before you sign. If you leave the NHS before the three-year lease ends, the leasing company charges an early exit penalty. The structure is: five months of contributions if you leave within year one, three months within year two, one month within year three. The penalty is deducted from your final pay. A transfer to another NHS Trust may be possible if both your new employer and the leasing company agree, but it is not guaranteed.
Pension impact
For staff in the 2015 career average NHS pension scheme, the salary sacrifice reduces pensionable pay for each year it is in place. Over a three-year lease, a Band 5 nurse sacrificing £3,000 per year sees a pension reduction of around £167 per year, roughly 1%. If you are within five years of retirement, speak to your Trust pensions manager first.
How to get a car through the NHS car scheme
- Check your Trust participates. Ask HR or fleet management whether your Trust offers the NHS car scheme and which provider they use.
- Request a quote. Contact NHS Fleet Solutions or your Trust's named provider. Quotes cover up to three vehicles. Provide an accurate mileage estimate.
- Complete the forms. Submit an order form, insurance declaration and your driving licence details.
- Sign the contract. Once forms are returned, you receive a contract. Your employer places the order with the leasing company on your behalf.
- Wait for delivery. Most cars are built to order. Delivery typically takes three to six months. Ask about stock vehicles if you need one sooner.
For the complete NHS car scheme guide covering eligibility, insurance rules and end-of-lease details, see our NHS car scheme guide.
Is Your Trust Eligible? How to Check
Neither the NHS car scheme nor salary sacrifice is available to every NHS employee. Both require your Trust to have opted into specific frameworks. Here is how to find out where you stand.
What is the CCS framework?
The Crown Commercial Service (CCS) is a government body that manages procurement agreements for public sector organisations. NHS Fleet Solutions operates under a CCS framework, which means your Trust must have chosen to sign up before you can access the scheme. Individual employees cannot join independently.
How to check
- Search your Trust intranet for 'car scheme' or 'salary sacrifice' on the staff benefits page.
- Ask your HR or payroll team directly: does our Trust offer an NHS car scheme or salary sacrifice car benefit?
- Check NHS Fleet Solutions to see if your Trust is a participating organisation.
Important: If your Trust does not participate in any scheme, the NHS car discount is available to you regardless. No Trust sign-up required.
What is NHS Salary Sacrifice?
NHS salary sacrifice is a car arrangement where you give up part of your gross salary in exchange for a car lease. Because the payment comes out before income tax and National Insurance are applied, your monthly cost is lower than a standard personal lease for the same car.
Salary sacrifice is separate from the NHS car scheme. Both involve salary deductions but they are different contracts, different providers and different eligibility criteria.
NHS Fleet Solutions: the national provider
NHS Fleet Solutions is the UK's leading salary sacrifice car scheme for NHS and public sector staff. When your Trust participates, NHS Fleet Solutions handles the lease, insurance, maintenance and tax administration in one monthly payment. You access the scheme through a company code provided by your HR team at nhsfleetsolutions.co.uk. If your Trust has not opted into the CCS framework, you cannot use this route.
How salary sacrifice works
The monthly lease cost is deducted from your gross salary before tax. Your taxable income falls and you pay less tax and National Insurance each month. The saving is largest for higher rate taxpayers and for electric vehicles, which carry the lowest BiK rate of any car type (currently 2% to 5% depending on the tax year).
A typical EV on salary sacrifice can save a basic rate taxpayer £150 to £250 per month compared with a personal lease. A higher rate taxpayer saves more. For petrol or diesel cars, the saving is smaller because BiK rates are higher.
What happens if you leave the NHS? Early exit carries a financial penalty. Because the car is leased in your employer's name, leaving the NHS before the lease ends triggers an early termination charge. This is passed to you. The specific amount depends on your provider and the point in the lease at which you leave. Ask NHS Fleet Solutions or your HR team for the exact penalty schedule before signing. A transfer to a new NHS Trust that also participates in the scheme may be possible but requires both parties to agree.
Other things salary sacrifice affects
- NHS pension. The 2015 career average scheme calculates your pension on average annual pensionable pay. A salary sacrifice reduces this each year it is in place.
- Maternity and paternity pay. These are earnings-based. A sacrifice in place during parental leave reduces the amount you receive. Check with payroll before signing up if you are planning a family.
- Mortgage applications. A reduced gross salary on your payslip can lower what a lender will offer. Check with your lender if you are planning to apply.
- National Minimum Wage. The sacrifice cannot reduce take-home pay below NMW. Lower Agenda for Change bands with existing salary sacrifices (cycle to work, childcare vouchers) should verify eligibility with payroll.
For a full financial comparison of all three options: Buying vs leasing vs salary sacrifice for NHS staff
How to get a car through salary sacrifice
- Confirm your Trust participates. Ask HR whether your Trust has opted into NHS Fleet Solutions or another salary sacrifice car scheme.
- Get your company code. HR will provide a code that gives you access to the NHS Fleet Solutions portal.
- Build your quote. Browse vehicles and see the monthly salary sacrifice amount and estimated tax saving for your salary and tax band.
- Sign the variation of contract. Salary sacrifice requires a formal change to your employment contract for the lease duration.
- Take delivery. Once the car arrives, your deduction begins. Insurance, servicing and BiK are all covered in the monthly amount.
Electric Vehicles: Which Option Works Best?
Electric vehicles change the calculation across all three options. Here is what NHS staff need to know.
Salary sacrifice and EVs: where the numbers are strongest
Salary sacrifice is most financially compelling when the car is electric. EVs carry a Benefit in Kind rate of just 2% in the current tax year, rising gradually to 7% by 2028 to 2029. Compare this with a petrol car at 25% to 37% BiK, and the monthly saving on an EV through salary sacrifice is significantly larger than on an equivalent petrol model.
For NHS staff whose Trust offers salary sacrifice and who want a new electric car, this combination delivers the largest monthly saving of any option. The lower your emissions, the lower your BiK tax and the more you save.
NHS car discount and EVs: own it outright
Motor Source Group offers NHS staff significant discounts on electric vehicles, with an average saving of £7,500 off list price across all makes and models including EVs. If you want an electric car and your Trust does not offer salary sacrifice, or if you want to own the car rather than lease it, the NHS car discount route gives you access to the same vehicles without any employer involvement.
Buying an EV outright also means no BiK tax, no early exit risk and no pension impact. For NHS staff who are planning a mortgage, approaching retirement or uncertain about their employment situation, owning an EV through the NHS car discount is a clean and straightforward option.
Which EV route is right for you?
| Your situation | EV route to consider |
|---|---|
| Your Trust offers salary sacrifice and you want the lowest monthly cost | Salary sacrifice on an EV through NHS Fleet Solutions |
| Your Trust does not offer salary sacrifice | NHS EV discount via Motor Source Group |
| You want to own the EV outright with no pension impact | NHS EV discount via Motor Source Group |
| You may leave the NHS before the lease ends | NHS EV discount via Motor Source Group |
For a full breakdown of EV options for NHS staff, see: Electric salary sacrifice vs NHS electric car discount
Which Option is Right for You? It Depends on These Factors
The right option depends on whether your Trust participates, how you use your car at work, your employment security and your financial situation.
| Your situation | What this means for your choice |
|---|---|
| Your Trust does not offer any scheme | The NHS car discount is your primary option. Available to all NHS staff regardless of Trust. |
| You drive regularly for work and need mileage reimbursed | The NHS car scheme is the only option that pays business mileage. Salary sacrifice and buying outright do not. |
| Your Trust offers salary sacrifice and you want an EV | Salary sacrifice on an EV delivers the largest monthly saving due to the low BiK rate. |
| You may leave the NHS or change roles during the lease | The NHS car discount carries no exit penalty. The scheme and salary sacrifice both do. |
| You are planning a mortgage or parental leave | The NHS car discount has no impact on gross salary, pension or maternity pay. |
| You are approaching retirement | Salary sacrifice affects pensionable pay. The NHS car discount does not. Speak to your pensions manager before committing to any salary-based arrangement. |
For a full financial comparison of all three options: Buying vs leasing vs salary sacrifice for NHS staff
NHS staff save an average of £7,500 off the manufacturer list price through Motor Source Group. Available to all NHS employees. No Trust sign-up required.
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