Too many cars??

Honest John Back Room » Motoring discussion
View Threaded
Mon 11 Oct 2004 20:08
Too many cars?? - ian205
Does anyone have any information on the following?

I'm a Peugeot 205 GTi enthusiast, I bought two earlier this year but afetr getting them back to standard I found an excellent 1.9GTi model I sold them to buy it. I'm now thinking of buying another limited edition model.

A friend has said he once read if you bought or sold more than a certain number of cars it was classed as trading. None of the two cars I've sold have been at a profit (probably completely the reverse!!) so does anyone have any more information.

Thanks, Ian
Reply | Report as offensive | Link
Mon 11 Oct 2004 20:28
Too many cars?? - PhilW
"None of the two cars I've sold have been at a profit (probably completely the reverse!!)"

HJ would class that as trading!!

Can't believe that this would actually be regarded as trading. Young lad next door to me seemed to buy and sell 205GTis every other month!!
Reply | Report as offensive | Link
Mon 11 Oct 2004 20:46
Too many cars?? - Robin Reliant
There is a figure beyond which the Inland Revenue and C&E will start to show an interest in your activities, but it is more than two. Seven sales in twelve months is something that springs to mind, but I can't be certain.
Reply | Report as offensive | Link
Mon 11 Oct 2004 20:54
Too many cars?? - richy
There is a figure beyond which the Inland Revenue and C&E
will start to show an interest in your activities, but it
is more than two. Seven sales in twelve months is something
that springs to mind, but I can't be certain.


What about scrapping cars? I broke up my last dead banger cause it was worth more for parts than it was complete. Might be doing the same with a Rover 100 Diesel next.
Reply | Report as offensive | Link
Mon 11 Oct 2004 21:13
Too many cars?? - ian205
There is a figure beyond which the Inland Revenue and C&E


What's C&E?

I also bought my Wife's car and it's in my name so in theory this will be Car 5. Can't see anything on the DVLA website about it.

Does anyone else have information on it?

Thanks for the help,

Ian

Reply | Report as offensive | Link
Mon 11 Oct 2004 21:15
Too many cars?? - Citroënian {P}
C&E

Customs and Excise

--
Lee
MINI adventure in progress
Reply | Report as offensive | Link
Mon 11 Oct 2004 21:27
Too many cars?? - Bromptonaut
Inland revenue (income tax etc) and possibly Customs (VAT) will take an interest if hobby becomes business and you are consistently making a profit. I don't konw what the test is but if you rely onthe money to pay for your holidays then you should probably be declaring it.

If you have a constantly changing stock of cars in your drive you might need to worry about the planners as well.
Reply | Report as offensive | Link
Mon 11 Oct 2004 21:22
Too many cars?? - Paul Robinson
As a private individual if you buy a car and sell it again at a profit, it is technically a 'capital gain' in the same way as you may buy (for example) a silver tea pot and later sell it at a profit would also normally be a capital gain.

As a private individual, capital gains on the disposal of motor vehicles is exempt from capital gains tax. This because if it were subject to capital gains tax the Revenue would also have to allow you to claim any losses you make on cars and offset them against any other capital gains you may make. As the vast majority of people sell cars at a loss, this wouldn't be a good idea for the Revenue!

However if the Revenue feel you have been buying cars with the intention of selling them again at a profit and have done this on a regular basis, they will claim you are 'trading' and will want to subject the profits you have made to income tax. The onus would then be on you show that there was a reasonable reason why you had bought and sold so many cars. Some districts of the Revenue will a number of sales each year that they will use as a guide to indicate if they feel you have been trading, but it is only one of a number of factors.

So that's the background, I don't think you've got anything to worry about.
Reply | Report as offensive | Link
Mon 11 Oct 2004 21:46
Too many cars?? - ian205
"However if the Revenue feel you have been buying cars with the intention of selling them again at a profit and have done this on a regular basis, they will claim you are 'trading' and will want to subject the profits you have made to income tax. The onus would then be on you show that there was a reasonable reason why you had bought and sold so many cars"

I think I've still got the adverts from the time the cars were for sale when I bought them, and then the confirmation of sale that shows they weren't sold at profit so that should be okay.

I'm intendinf to keep the one I have and this next one for a while, though I've said that before and along comes another nice one. Anyone know some one who has a Griffe for sale?!

Thanks for the help again, Ian
Reply | Report as offensive | Link
Tue 12 Oct 2004 09:48
Too many cars?? - blue_haddock
Hiya Ian,

Chances of finding a Griffe for sale in this country are rarer than hens teeth. I've got a 205 STDT at the mo and used to have a 309 Goodwood.

Are you a member of any pug forums?
Reply | Report as offensive | Link
Tue 12 Oct 2004 10:26
Too many cars?? - Cliff Pope
They may well show an interest, but the number of cars has to be much higher than yours. I too have heard 7 in a year from somewhere.

My brother in law has done this as a hobby for years and has never been questioned. I think it also makes a difference whether you buy cars for immediate resale or genuinely run them for a bit as your own cars.
A colleague was questioned by the DVLA because of the number of cars he had registered in his name. He had about 10 in a barn, some in bits or being broken, others he was working on. He was able to satisfy them that he was not a trader, just an old car enthusiast.
Reply | Report as offensive | Link