A company car is a perk that an employer can offer employees to use on the job and/or for private journeys. If you drive a lot of miles for work, it’s a great option to cut motoring costs as the vehicle will be paid for and maintained by your employer. You’ll have a fixed monthly tax bill deducted from your salary as a contribution. On the other hand, car allowance is a cash sum that employers can add onto employees’ earnings so that they can afford to buy or lease a car. Car allowance tends to be less common than a company car, though it offers more flexibility as you can pick and choose what type of car to get with the money. A company car will be less flexible as the employer will choose the type of vehicle.