The total bill for expenses such as vet's fees, food, kennels and other necessities adds up to an average of 22,000.
There is, however, a big difference between breeds - a small dog such as a Jack Russell terrier is estimated to cost up to 18,000, compared with 33,000 for a Great Dane.
Individual owners also differ, with some choosing expensive kennels for their dogs when they go away on holiday, while others rely on dog-sitters or friends and family.
Some also go as far as buying luxury leads, designer collars and brand-name accessories, such as neckerchiefs and wellington boots for their pets.
The annual "Cost of A Dog" report by Churchill Insurance claims more than 90 per cent of owners underestimate the true cost of looking after their pet, putting the total at less than 5,000.
Using its own pet insurance data and a survey of nearly 2,000 owners, the company worked out costs, including the initial purchase price and the annual cost of food, care, health, insurance and other bills.
A Great Dane may live for only an average of ten years, but during that time the bills for such a large dog add up to 32,810, buoyed by the sheer quantity of food it consumes. In contrast, the Jack Russell, which eats less but lives two years longer, will cost 18,052.
While mongrels tend to be the longest living, with an average life expectancy of 16 years, they cost only 21,734 to maintain.
In the survey, 68 per cent of dog owners said there was nothing better than the unconditional love and companionship they received in return for the outlay - although 29 per cent complained about dog hairs and 14 per cent about the smell.
Mike Ketheringham, of the insurance company, said: "There are significant differences between the costs of different dog breeds. It is important people take this into account as one of the factors when choosing their new pet."
But Bert Easdon, from Glasgow, a member of the Scottish Kennel Club who owns 20 Pekingese dogs, said the 5,000 estimate by owners was a more accurate figure for caring for a dog over its lifetime.
"I think the 22,000 is at the high end of the scale and sounds more like a ploy by an insurance firm wanting you to take out one of its policies. Of course, there are insurance costs, but my advice is to insure a dog for the first year only, because it is when they are very young that accidents are likely to happen.
"Other costs, such as feeding and dog-sitting, don't need to be sky-high either. Instead of buying expensive tins of dog food from supermarkets, you can buy meat in bulk from pet shops or wholesalers. Most 'dog people' will have a network and help look after each other's pets during holidays or emergencies."
Mr Easdon added: "The survey might make some people think seriously about buying certain breeds. A Poodle which needs grooming every six weeks at 30 a time is what I call high maintenance. Why not choose another breed without that sort of cost?"
Karen Easter, of the online firm puccipets.co.uk, which sells designer accessories for dogs, said an increasing number of people were prepared to spend large sums of money.
"Dogs these days are more included in the family," she said. "People like to spend money on them the way they would with a child. If it's raining and they're shaking with cold, why shouldn't they have a nice warm coat to wear?
"We're also a lot more image-conscious and buying things for your dog such as a distinctive raincoat or lead means they get noticed. My dogs have polka-dot leads that make people smile."