Methodology

Three figures, every calculator

Headline payment — the number usually advertised, e.g. a PCP or lease monthly rental.

Effective monthly outlay — every pound that actually leaves your account, spread over the agreement: deposit, fees, and any balloon or initial rental included.

True cost — effective outlay minus the estimated value of any asset you still hold at the end. If you don't end up owning anything (returning a PCP car, or any lease), true cost equals effective outlay — there's no deduction to make.

Finance formulas

PCP and HP monthly payments use the standard reducing-balance annuity formula, with a residual (balloon) value for PCP. This is the same underlying method most UK lender illustrations use, but your lender's exact figure may differ slightly due to fees, payment timing conventions, or how APR is contractually applied — where you have an actual quote, our calculators let you enter it directly instead of estimating.

Leases are modelled as an initial rental followed by (contract length − 1) further monthly rentals, matching the standard UK "X+Y" convention (e.g. 9+35 for a 36-month deal). We support both a rounded multiple of the monthly rental and an exact £ figure, since not every real quote uses a round multiple.

Depreciation and end value

Where a calculator needs to estimate what a car will be worth in future, it defaults to a flat annual depreciation rate (illustrative, not vehicle-specific) which you can adjust, or you can enter your own estimate directly. We don't yet have make/model-specific valuation data — until we do, treat any "illustrative estimate" as a starting point, not a valuation.

Sources

Where a calculator references UK-specific rules (VED, mileage or finance conventions), we aim to align with published guidance from GOV.UK, the FCA, and MoneyHelper. Figures are reviewed periodically, not continuously — check the "Last reviewed" date on each calculator page.