Where I work does it if you're likely to cover more than x thousand business miles per year. They give you something like =A3400 per month on top of your normal salary, taxed and NI'd as if it were your salary.
You choose the car, or just use your existing car if it fits the criteria, those being: It must be kept in good working order and good visual condition It must be insured Class 1 business use It must be able to seat four (people are really stretching this buying Audi TT and Mini Cooper S etc) I don't think age is so much a factor. There's a guy with a wanky MK1 Saab 9-3 and I'm pretty sure my TI would qualify. You must use your car instead of public transport unless it really is absolutely necessary to use public transport, or if the client is paying for your travel.
Instead of the usual 40p per mile expense claim you get a *lot* less and it depends on engine size, petrol or diesel etc.
People tend to either use it to pay all their car running costs and run an older car or use it to buy a better car than they'd otherwise be able to afford.
My company does it because people were being so highly taxed on company cars since the new rules that people were finding it more expensive to have the "benefit" of a company car than to run their own one.