Previous estimates of whether long-term exposure to benzodiazepines increases dementia risk are conflicting and are compromised by the difficulty of controlling for confounders and by reverse causation. We investigated how estimates for the association between benzodiazepine use and later dementia incidence varied based on study design choices using a case-control study nested within the United Kingdom's Clinical Practice Research Datalink. N=40,770 dementia cases diagnosed between April 2006 and July 2015 were matched to 283,933 controls on age, sex, available data history and deprivation. Benzodiazepines and Z-drug prescriptions were ascertained in a drug exposure period 4-20 years prior to dementia diagnosis. Estimates varied with the inclusion of new or prevalent users, with the timing of covariate ascertainment, and with varying time between exposure and outcome. There was no association between any new prescription of benzodiazepines and dementia (adjusted odds ratio 1.03; 95% confidence interval 1.00, 1.07), while among prevalent users and inverse association was observed (adjusted odds ratio 0.91; 95% confidence interval 0.87, 0.95), although this was likely induced by unintentional adjustment for colliders. By considering the choice of confounders and timing of exposure and covariate measurement, overall our findings are consistent with no causal effect of benzodiazepines or Z-drugs on dementia incidence.