Car acquisition methods

Understanding your options.

There are five main ways to acquire a new car in the UK — and each works very differently in terms of ownership, cost, flexibility, and tax efficiency. This page gives you a factual overview of all of them, with deeper detail available for each one.


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Salary sacrifice
Employer salary sacrifice scheme
Salary sacrifice
Employer salary sacrifice scheme

Give up a portion of your gross salary in exchange for a fully maintained car. Because the sacrifice happens before tax, both you and your employer pay less National Insurance.

Who it’s forEmployed individuals whose employer offers a scheme
Own the car?No — leased through employer for the term
Typical term2–4 years
Tax benefitSignificant — especially for EVs at 4% BiK (2026/27)

Full salary sacrifice guide

PCP
Personal Contract Purchase
Personal Contract Purchase
PCP — Personal Contract Purchase

Pay a deposit and monthly payments over an agreed term, then choose to hand back, pay a balloon payment to own, or part-exchange into a new deal.

Who it’s forAnyone wanting lower monthly payments with end-of-term flexibility
Own the car?Not until the optional final payment is made
Typical term2–4 years
Tax benefitNone — personal finance product

Full PCP guide

HP
Hire Purchase
Hire Purchase
HP — Hire Purchase

Pay a deposit and fixed monthly instalments until the car is fully paid for. At the end of the term you own the vehicle outright with no further payment required.

Who it’s forAnyone who wants to own the car outright at the end
Own the car?Yes — automatically at end of agreement
Typical term2–5 years
Tax benefitNone — straightforward finance product

Full HP guide

PCH
Personal Contract Hire
Personal Contract Hire
PCH — Personal Leasing

A long-term rental arrangement with fixed monthly payments over an agreed term and mileage. At the end you simply hand the car back — no option or obligation to buy.

Who it’s forAnyone wanting a new car regularly without ownership responsibility
Own the car?No — always handed back at the end
Typical term2–4 years
Tax benefitNone for personal use

Full PCH guide

Cash
Outright cash purchase
Cash purchase
Outright cash purchase

Buy a car outright with your own funds — no finance agreement, no monthly payments, immediate full ownership. Simple and straightforward, though it ties up capital.

Who it’s forAnyone with available capital who prefers to own outright
Own the car?Yes — immediately and outright
Typical termNo fixed term — keep as long as you choose
Tax benefitNone for personal use

Full cash buying guide

Hover over each card to explore

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Salary sacrifice and EVs — a particularly powerful combination

Salary sacrifice schemes are available for all vehicle types, but the financial benefit is most compelling for electric vehicles. The combination of pre-tax salary sacrifice, the 4% Benefit in Kind rate for EVs in 2026/27, and the lower running costs makes this the most tax-efficient way most employees can acquire a new car.


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Side by side comparison

A factual overview of how each method compares across the key factors most people care about.

Factor Salary sacrifice PCP HP PCH Cash
You own the car ✕ Optional ✓ ✕ ✓
Monthly payments Via salary deduction Yes Yes Yes No
Upfront cost Usually none Deposit required Deposit required Initial rental Full purchase price
Income tax saving ✓ ✕ ✕ ✕ ✕
NI saving (employee) ✓ ✕ ✕ ✕ ✕
NI saving (employer) ✓ ✕ ✕ ✕ ✕
Benefit in Kind tax applies ✓ ✕ ✕ ✕ ✕
Maintenance typically included ✓ ✕ ✕ Optional ✕
Mileage restrictions ✓ ✓ ✕ ✓ ✕
Early exit flexibility Limited Limited Statutory half rule Limited Sell anytime
Available without employer ✕ ✓ ✓ ✓ ✓

This table is intended as a general factual guide. Individual circumstances vary — contact us for a personalised comparison based on your situation.

Not sure which option is right for you?

Every one of these methods can be the right choice depending on your individual circumstances — your employment situation, how you use your car, your attitude to ownership, and your tax position all play a part.

We’ll look at your specific situation across all five options and give you a clear, factual comparison of what each would mean for you — including the ones where we earn nothing from the outcome.


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All five methods compared for your situation
We don’t just explain the options — we apply them to your actual numbers so you can see what each would cost you in practice.

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Including options where we earn nothing
If cash purchase or a straightforward HP deal is genuinely your best move, we’ll tell you — even if there’s no commercial outcome for us.

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No jargon, no pressure
We explain each option clearly and give you time to consider. There’s no obligation to proceed with anything we recommend.

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We stay with you through the process
Once you’ve chosen a method, we help you navigate the paperwork, the providers, and any questions that come up along the way.

Ready to work out which option suits you?

Book a free, no-pressure conversation and we’ll give you a clear picture of how each method applies to your situation — so you can make the right decision with confidence.


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