How do you become a motor trader?

I want to get into buying and selling second hand cars. I am partnering with one of my friend and we want to start this small business as an extra income. Can you tell me what documentation we need to start? Is there anything we should know?

Asked on 20 April 2016 by vikas

Answered by Honest John

First you will need trade insurance and depending on how old you are it will cost £900 to £5000 a year, third party, road risks only. You cannot get trade licence plates until you can prove you have been trading for a year or so and you have to have off road premises on which to store at least a couple of cars.

If your turnover will be more than £83,000 for 2016/2017 you have to be VAT registered and keep accurate VAT records. Money is made by buying cheap, not by selling dear, and in the competitive environment of an auction it is very difficult to buy sufficiently cheaply. You will need a significant balance in a bank current account to get an auction trade card that allows you to buy at trader commission rates.

Tags: buying and selling

Dear Honest John,

Please help me choose my next car. I would like it to have:

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