According to a vehicle-related benefits survey in 2011 by World at Work, the average car allowance per month is $500 to $900 depending on the position of the employee. Company executives generally receive higher car allowances between $1,000 and $2,000. Sales representatives, directors and managers typically receive a car allowance.
A car allowance covers the cost of gas, wear and tear, and insurance on a personal vehicle as a result of use in the course of business. Different companies have different car allowance programs, with some providing a flat car allowance that is taxable. The IRS set the rate at 57.5 cents per mile for business mileage as of 2015.