I bought it a year ago but took out a loan. If I sold now I'd have just about enough to pay off the loan, so all would be square. I wouldn't lose or gain anything, so I guess the question is whether company car is a better deal on this kind of mileage or not?

I really like the car, but I guess the only thing I kept reading is that repair bills on modern diesels go up as it reaches the 60-80k mileage and this would accelerate that? I was planning to sell the car with 40k-ish mileage in 3 years when I'd have paid off the loan naturally and have a genuine asset. I had the allowance previously so isn't really a gain but repairs and the higher mileage could devalue the car significantly hence my confusion.

According to the contract once I pick the allowance I can't back opt to the company car, but can do the opposite which seems odd?

Hi

I should also clarify that the mileage will be personal (my commute will increase drastically) as a result of redundancy in my previous company at Xmas...

I've spent the night crunching numbers and I think I get to this over two years (it has to be around 2 years as there's a clause in the car allowance that says I can't have a car that is a) more than 5 years old, or b) has more than 70000 miles on the clock):

Car Allowance: Tyres probably £150 every yr, Servicing and repairs at around £600/yr, Insurance at £450/yr which gives me a total running cost of around £1200/yr. BUT I've then got the loan rate at £4200/yr so the actual cost is £5400, which is the same as the pre-tax income from the allowance. But in 2 years time I'll have an asset worth around £7k, (less £3k for the outstanding finance) So my actual running cost is £3400/year, which the CA increases my base salary by £2500 after tax, NI and student loan repayments. So I'm £900 down a year...only I'm not...because I need a car so...

Company Car: I've been told I can get the new XE Prestige 2.0d which has a low rate of tax band, so would cost around £160/month or £1900/yr. If I had the same Audi it would be £111/month, or £1330. The same is true if we used to replace my other halfs Volvo V40 D2 - its £110/month.

So either way, the Company Car is SLIGHTLY more expensive, but is cheaper to have a nicer car, if that makes sense and is obviously hassle free but if I leave the job I have no car? Does that sound right to people in your experience? The benefit of Company Car is to have, effectively, a nicer car for less, but a Car Allowance means you can run a perfectly decent car for less? On this basis I think I'm going to stick with the Allowance, assuming I have the maths right!

The company car has so many advantages that are worth having, even if it works out more expesive - though admittedly you do need to do your sums very carefully including income tax.

If the car needs new tyres, a phone call is all you need to do.

When it comes to servicing, phone up and it's taken care of. There's not that awful moment when the garage calls you and says they've found this component that needs changing, parts cost £x, labour £y. There's no fear of the cost of an unexpected breakdown. And if the car is off the road because of a major failure, it's likely you'll get a courtesy car as part of the deal.

You don't have to do the insurance phone-around each year. You don't have to remember to tax the car.

When the car gets a bit long in the tooth, you don't have to worry about getting the best trade-in, perhaps hawking it round several dealerships. They just take it away and you get a new one.

You might be lucky and get AA or similar cover - the car we have includes European breakdown cover, too.

If something untoward happens to the car, as it will, it's a great comfort to know that someone else is picking up all the bills and doing all the administration concerned with owning and running a car.

All you then concentrate on is retaining a clean licence and doing whatever job it is that you are doing.

Company car every time.