Small-scale used car dealer from home

Private buyers looking for a reliable, affordable car, often first-time buyers, families and people who want a cheaper alternative to a main dealer.

You keep the margin between what you pay for a car, including repairs and prep costs, and what you sell it for. A sale may also include an optional paid warranty.

• Spotting good-value cars and knowing what to avoid
• Negotiating when buying and selling
• Basic car knowledge and honest descriptions
• Keeping clear records

• If you buy and sell cars regularly for profit, you are likely to be treated as a trader, so check how to advertise and declare yourself properly
• Consumer Rights Act 2015 duties: cars must be as described and of satisfactory quality, so check what that means for refunds and repairs
• Motor trade insurance, and whether your home or street parking is suitable for stock (check with your landlord, mortgage lender or council)
• Hidden problems such as outstanding finance, clocked mileage or accident damage, so always run a history check
• Check VAT rules, including the margin scheme, and keep full records for tax
• Offering or arranging finance is likely to need Financial Conduct Authority permission, so check before you do so
• Your cash is tied up in stock, so a car that does not sell quickly can hurt

Startup costs are typically around £6,000 to £25,000, depending on how many cars you stock, what you pay for them and your insurance. These are estimates, and your cash is tied up in stock until each car sells.

If you buy and sell cars regularly for profit, you are likely to be treated as a trader, so check how to advertise and declare yourself properly. Also check Consumer Rights Act 2015 duties, motor trade insurance, VAT margin scheme rules and history checks.

Monthly revenue is typically around £3,000 to £15,000, depending on how many cars you sell and their prices. The estimate assumes at least 10 hours a week. Revenue is not profit, and a car that does not sell quickly can hurt.