Company car or mileage allowance: which one to choose?

Your company is offering you a car, or you are wondering whether to put one on the books? The right answer mostly depends on how much you really drive.

On one side, the company car: the business pays for the purchase or the lease, the insurance and the servicing, but private use becomes a taxable benefit in kind. On the other, your own vehicle reimbursed with the mileage scale: the business only pays for the kilometres actually driven.

I put both columns side by side, without the jargon, with your own numbers.

The calculation

Enter your business kilometres, the yearly cost of the company car you are considering and your vehicle's tax horsepower: you see both totals face to face, and the point where one overtakes the other.

What each option does to your wallet

Company car

€2,340

out of your pocket, per year

Taxable benefit in kind: €4,500
Income tax + contributions (52%): €2,340

Your own car + allowance

€1,465

left in your pocket, per year

Mileage allowance received: €4,965
What your kilometres cost you (€0.35/km): − €3,500

Your own car leaves you €3,805 better off over the year.

Shall I email you the PDF report?

I put your simulation, the detailed maths and the assumptions into a PDF. It lands in your inbox, free of charge — and your result stays right here whatever happens.

What I assume, and what I leave out

I compare what changes for YOU, not for the company: a company car only costs you the tax on the benefit in kind, while your own car brings in the allowance minus what driving it really costs.
Vehicle made available since 1 February 2025 and five years old or less: these are the rates of the 25 February 2025 order.
Flat-rate valuation of the benefit in kind, not the actual-cost one. It is the most common method, but your employer may choose the other.
Employee contributions estimated at 22% of the benefit: an order of magnitude for the private sector, not your exact rate.
Your business kilometres are counted at €0.35 per kilometre (fuel, tyres, servicing, wear). A small city car costs less, a large SUV costs more.

Indicative estimate — it does not replace tax advice.

Frequently asked questions about this tool

What really changes between the two?

Who pays for the car. With a company car, the business carries the full cost and you declare a benefit in kind for private use. With the mileage allowance, you keep your own vehicle and get your business trips reimbursed per kilometre.

From how many kilometres does a company car pay off?

There is no universal threshold: it depends on the yearly cost of the vehicle, your share of private use and your tax horsepower. In practice, the more you drive for work, the better the company car looks; below a few thousand kilometres a year, the mileage scale usually stays simpler and lighter.

What is a benefit in kind?

It is the value of the private use of a car paid for by the business. It is added to your taxable pay: that is what makes a "free" car a little less free than it looks.