Car allowance - lease vs buy

[Keepersball]

Hi all,

New to the forum and first post so go easy on me 😜

I’m starting a new job in sept and will have a £400 car allowance (After tax I reckon i will only see just over £200) I’ve always had company cars so now need to decide what and how to get.

My thoughts are that if I get a loan and buy over 4 years then at the end I’ll be left with residuals in the car which is essentially free money.

Allowance scheme is pretty open with only stipulation being must have 4 doors (no mileage or age restrictions)

So my question is with a budget of £12k what would you go for - ideally nothing over 7 years old ?

Or alternatively am I being daft and should I go for a lease - if so with a budget of around £300 a month and £2.5k to put down what should I look at?

Thanks all

[Keepersball]

Thanks for all the advice guys in answer to some of the questions

I’ll be doing around 15k miles per year

10k of these will be business miles which I can claim back at £0.15 per mile

I’d be looking to keep the car for around 3 - 4 years

No requirements on size other than having 4 doors

If I was looking to buy I’d be looking used and examples of what I’ve seen around £12k include jag xf or golf gtd

Cheers

[Keepersball]

I definitely have to buy something as I’m currently in a company car which I have to give back when I leave my current business so will be without anything in 2 months time

[Keepersball]

Just to give you my take on what I meant

Currently it is possible to get a £10k loan at 2.9% apr with monthly repayments of circa £220

Assuming I put £2k towards the car then use the car allowance to pay off the loan - at the end of the loan payments any residuals above £2k in the car will be free money as I will have recovered initial outlay and won’t have paid back any loan payments personally as they come from the allowance

Hope this makes sense

[Keepersball]

Completely understand what your saying and agree it is part of my salary

I guess in my head I’m comparing it to a lease - for arguments sake let’s say total value of lease over 4 years is £12k at the end of this I would be left with nothing

As discussed with a purchase your left with residuals

Given I don’t have a car and have to have one and can’t really buy a banger due to miles driven and having to transport customers - it’s the comparison of the lease vs purchase that I was working through.

So given all that any thoughts on what second hand car around £12k I should be looking at?