Ebay & selling cars

alarmed

I'd like to start selling cars one at a time on ebay for some extra cash.
Would I need to register as a motors trader on there even though I would only have one car for sale at a time?

Thanks as usual

pooch

alarmed wrote: »

I'd like to start selling cars one at a time on ebay for some extra cash.
Would I need to register as a motors trader on there even though I would only have one car for sale at a time?

Thanks as usual

If you are buying something with the intention of selling it on, then that means you are a trader.

Don't forget to register with HMRC

bengalknights

Yes you would and also notify hmrc

1jim

But I suppose if you were one person, having one car, insured in your name, and then selling it, getting another one..... Could just be that you get bored very quickly and trading up until you get your dream car rather than a business transactions

Lomast

Not sure if it works for cars but i know a builder who buys a house that needs work doing and does it up while living there and as its his only residence he doesnt have to pay capital gains tax on it when he sells it

1jim

That's how I understand it, if it's your house/car it would be up to hmrc to prove its a business, given its only one car/house and if driven/lived in and used as own car/residence then it would be hard to prove its a business

martindow

Some people change cars fairly frequently, but if you were buying and selling every week or two that would look like trading and I would think HMRC might be interested.

YoungBusinessman

One a month wouldnt raise many eyebrows upon HMRC, more and you are asking for trouble if things are not above board.

Brassedoff

1jim wrote: »

But I suppose if you were one person, having one car, insured in your name, and then selling it, getting another one..... Could just be that you get bored very quickly and trading up until you get your dream car rather than a business transactions

Nice one, a bit close to the wind, but well worth a try. I'd do it.

1jim

Brassedoff wrote: »

Nice one, a bit close to the wind, but well worth a try. I'd do it.

I'd try it as well, there was a programme on sky years ago where the presenter did just that, started with a £50 banger from the back of a car dealers and just kept doing them up, some were really just a clean and wax to make it look nice, can't remember what he ended up with though but it wasn't bad for his £50 starting price

If I were the op, and literally wanted to do one car at a time that's how I'd do it, buy cheap, insure tax and register in my name, use it as my car then sell at first opportunity. I think hmcr would struggle to prove that it's a business, if I knew the first thing about cars and had time and inclination I'd do this

motorguy

1jim wrote: »

it would be up to hmrc to prove its a business,

No, if HMRC take an interest - either by picking up on the amount of ads being placed or by (the more likely) a neighbour or disgruntled customer raising it with them - then it would be up to the O/P to prove its NOT a business.

I dont approve of this on many levels.

(1) you are motor trading but avoiding your responsibilities - both to HMRC and to customers - by advertising as private. If you think there is no harm in this, then have a look at the motoring board at the amount of people who have bought a car from what clearly is a motor trader, have had problems and the seller tries to wash his hands of it.

(2) It will only take one disgruntled customer to twig that you have a history of listing cars in quick succession for them to go to Trading Standards, who will then be on your back.

(3) Your insurance company will put a stop to it after you move several cars on in quick succession.

(4) If you opt to buy, drive, and sell, then inevitably you will cause some problem to manifest itself during that timeframe which you will have to fix and thus eat into your margin.

(5) Its not as easy to do as you think. Where are you going to source cars, for example? If its at auction, 80% of the cars that are there are there because theres some fault that the previous owner - whether that be private or trade - doesnt want to deal with, which can totally destroy any margin you might have.

(6) its very simplistic to think that you'll buy one car, drive it, sell it, buy another car the same day, drive it sell it, etc, etc. It wont end up like that. You'll sell a car unexpectedly and be left with no car OR you'll buy ahead of yourself and have two or three, which then wont sell, etc, etc.

(7) If HMRC or the VAT man catches up with you, they will back tax you on what they THINK you've been earning, as well as fine you.

So, yes, if you want to be considered among the low life who buy and sell under the radar with excuses like 'the wife didnt like it' then go ahead.