My employer offers a car lease scheme whereby the employee pays for the lease and pays BIK tax. This is paid via salary sacrifice, so you pay less tax, NI and pension contributions. I've been considering leasing a car through this scheme, but cannot understand why I would have to pay BIK tax if I'm paying the cost of the lease. It's not a company car and the lease costs are not particularly competitive (for example a Fiesta ST came out at £310 for the car after tax, NI and pension contribution reductions and £140 BIK tax, so £450 a month). I can't really see what the employer is contributing, so why is this considered a Benefit in Kind?