Index
Sole trader or limited company? How to choose the legal structure
Mandatory procedures and licences
The premises: what you need and what to look for
How much money you need to start
How to get your first stock
Basic taxation: VAT, REBU and taxes
First steps to sell: portals, website and visibility
Common mistakes when opening a dealership
Frequently asked questions
Setting up a used car dealership in Spain is an accessible business, but not an easy one. It does not require a million-dollar investment to start, but it does require a good understanding of the legal procedures, the sector's taxation and how used vehicle buying and selling operations work.
Many dealers who have been in the sector for years started with a small car park, 5 or 6 cars in stock and a lot of manual work. Some still manage this way. Others have professionalised their processes and grown. The difference is almost always in how well they prepare during the first few months: choosing the correct legal structure, having the documentation in order and setting up a management system that allows them to scale without drowning in paperwork.
This article covers everything you need to know to open a second-hand car dealership, from choosing between being a sole trader or a limited company to how to get your first cars to sell.
Sole trader or limited company? How to choose the legal structure
The first decision you have to make is whether you operate as a sole trader (individual) or as a company (usually a Limited Liability Company, S.L.).
Sole trader (autónomo) is the simplest option to start. Registration is quick, management costs are lower and you have access to the flat rate for sole traders during the first year. The downside is that you are personally liable with your own assets for business debts. If things go wrong, your personal assets are at stake.
Limited Company (S.L.) requires a minimum share capital of 1 euro (since the 2022 reform, although the usual recommended threshold is 3,000 euros), a notary deed and registration in the Mercantile Registry. The main advantage is limited liability: you are only liable with the capital contributed to the company. In addition, from a tax perspective, it can be more advantageous from certain billing levels (broadly speaking, from 40,000-50,000 euros of annual profit, the flat rate of Corporate Tax is usually more favourable than the progressive personal income tax of the sole trader).
Practical recommendation: if you are starting alone and with little stock (less than 10 cars), starting as a sole trader is the most agile way. If you are starting with a partner, significant investment or a large stock, an S.L. is worth it from day one.
Mandatory procedures and licences
Once the legal structure has been decided, these are the administrative steps you need to complete:
Registration with the Tax Agency (Hacienda). Registering in the census of entrepreneurs using form 036 or 037. You need to choose the economic activity code corresponding to vehicle trading (IAE heading 615.1: "Wholesale trade of vehicles"). If you are also going to operate under the Special Regime for Used Goods (REBU), which is standard, you must declare it at this exact moment.
Registration with Social Security. Enrolment in the RETA if you are a sole trader, or registration of the company and directors if it is an S.L.
Opening licence from the Town Hall. You need an activity licence for the premises where you will operate. The type of licence and the requirements vary by municipality and depend on the size of the premises, location and whether you perform complementary activities (workshop, car wash). This procedure can take between 2 weeks and 2 months depending on the town hall.
Registration as a professional operator with the DGT. To carry out vehicle transfers as a professional, you need to register as a DGT collaborator (vehicle administrative manager). This requires a valid digital certificate, registration in the electronic notification system and compliance with data protection regulations. If you want to see the complete registration process as a dealership, we detail it step-by-step in our guide to registering as a dealership.
Public liability insurance and stock insurance. Public liability insurance is mandatory if you open premises to the public. Stock insurance (which covers the cars you have on display against theft, fire or damage) is not legally mandatory in all cases, but it is highly recommended. An incident in a stock of 15 cars can mean a loss of more than 100,000 euros.
The premises: what you need and what to look for
The space where you display and sell cars builds trust or destroys it. You do not need a branded dealership with glass walls, but you do need a functional and presentable space.
Minimum requirements: a display area with capacity for at least 5-8 vehicles (outdoor or indoor), an office with an internet connection for administrative management and customer service, toilets, and adapted access for people with reduced mobility if the premises exceed a certain size (check municipal regulations).
Location. Ideally, an area with visibility from the road and easy access. Commercial parks or access roads to medium-sized cities usually work well. Premises on a residential street with no road traffic might seem cheaper, but the lack of visibility translates into fewer walk-ins.
Cost. In medium-sized cities, premises or a plot with space for 10-15 cars can cost between 500 and 1,500 euros per month in rent, depending on the area. In large cities (Madrid, Barcelona, Valencia), prices rise considerably.
Alternative: model without fixed premises. Some dealers operate from a car park or from their own plot, without a traditional commercial space. This is legal if you comply with the activity licence and municipal regulations, but it limits your professional image and your ability to attract walk-in clients.
How much money you need to start
There is no single figure, but there is a realistic range. To set up a dealership with a minimum level of professionalism, you need to consider:
Initial stock: between 5 and 10 cars to start. If you work with mid-range vehicles (purchase price between 5,000 and 10,000 euros), this means between 25,000 and 100,000 euros. This is the largest expense and the one with the most variability.
Premises (first month + deposit): between 1,000 and 4,000 euros.
Legal procedures and constitution: between 500 and 2,000 euros (notary, registry, management agency, opening licence).
Tools and equipment: computer, office furniture, signage, cleaning materials for the cars. Between 1,000 and 3,000 euros.
Management software, portals and website: between 100 and 400 euros per month, depending on the tools you use.
Insurance: between 1,000 and 3,000 euros annually, depending on coverage and stock volume.
Working capital: it is advisable to have at least 3 months of fixed expenses covered without relying on sales. Between 3,000 and 10,000 euros.
In total, a realistic start-up cost ranges between 30,000 and 60,000 euros to start with 5-8 cars and functional premises. If you want to delve deeper into how to structure a business plan for your dealership, we recommend our article on how to prepare a business plan for a dealership.
How to get your first stock
The profitability of your dealership starts with the purchase, not the sale. Choosing your first cars well is what makes the difference between starting with a margin or starting by losing money.
Buying from private individuals. This is the channel with the most margin potential because there are no intermediaries. You can find opportunities on Wallapop, Milanuncios, Facebook Marketplace or by capturing leads directly with a "we buy your car" page on your website. It requires more negotiation and more verification time (mechanical condition, documentation, outstanding debts), but it is the most profitable source in the long run.
Professional auctions. Platforms like BCA, Autorola or Auto1 allow access to fleet cars, ex-lease vehicles and financial repossessions. They offer volume and traceability, but the margin per unit is usually smaller because you compete with other professionals. They are a good option to supplement stock.
Network of other dealerships. Buying from other dealers or swapping units is a common practice in the sector. You can get cars that another dealership is struggling to move but that fit your client profile perfectly.
Import. Buying in Germany, France or the Netherlands can be profitable for specific models (premium, automatic, electric), but it involves type approval, import ITV (MOT), logistics and specific documentation. It is not recommended as a primary source of stock if you do not have experience.
The important thing when starting out is to specialise: choose a segment (diesel compacts, petrol SUVs, budget city cars) and learn to buy well in that niche before diversifying. If you want a more complete analysis of sourcing channels, you can find it in our article on where dealerships buy cars.
Basic taxation: VAT, REBU and taxes
Taxation is one of the areas that causes the most confusion when starting out. The two concepts you need to understand from day one are VAT (IVA) and REBU.
General regime (VAT at 21%). This applies when you buy a car from a company that issues an invoice with itemised VAT (leasing, fleets, other dealerships under the general regime). When reselling, you charge 21% VAT on the total price.
REBU (Special Regime for Used Goods). This applies when you buy from a private individual or a professional who has not itemised VAT. You only pay tax on the margin (selling price minus purchase price), not on the total. This is the most common regime in the sale of used cars to private individuals and the most advantageous for transactions with final consumers.
You must notify the Tax Agency that you operate under REBU when registering (form 036). In addition, you are obliged to keep a separate register book for REBU transactions and to issue invoices in the correct legal format (without itemised VAT, with explicit mention of the regime). To properly understand when to apply each regime, consult our article on when to use an invoice with VAT and when with REBU.
Other taxes to keep in mind: Corporate Tax (if you operate as an S.L.) or Personal Income Tax (IRPF, if you are a sole trader), quarterly VAT (form 303), declaration of transactions with third parties (form 347), and the Property Transfer Tax (ITP) paid by the private buyer in transactions between individuals (does not apply when the seller is a professional with an invoice).
Manage all the procedures for your dealership from a single place. Find out more at dealcar.io/gestoria.
First steps to sell: portals, website and visibility
Having cars in stock is pointless if no one sees them. From day one, you need online visibility.
Car portals. Coches.net, AutoScout24, Wallapop and Milanuncios are the main channels where buyers search for used cars. Publish your cars with high-quality photos (clean background, good lighting, all angles), detailed descriptions and competitive prices. Do not skimp on this point: an ad with dark photos and no information loses clicks to a well-presented one.
Own website. Having your own website with an updated stock list provides professionalism, allows you to capture direct leads (without depending solely on portals) and improves your local ranking on Google. A website that shows your cars with filters, photos and a contact option is enough to start. If you want to know how to set up your dealership's website, we recommend our article on the benefits of having a website for your dealership.
Google Business Profile. Create and optimise your Google listing with photos of the premises, opening hours, phone number and reviews. It is free and it is the first thing that comes up when someone searches for "used car dealership in [your city]". Positive reviews are gold. If you want to know more, we recommend our article Local SEO for Dealerships: Position your dealership with Google My Business
Centralised management. If you publish on 3 or 4 portals at the same time, doing it manually consumes hours every week and leads to errors (different prices, sold cars that remain listed). A management system that centralises your stock and synchronises it with the portals saves you time from day one.
Common mistakes when opening a dealership
Buying stock without calculating the total cost. The purchase price is only one part. Add reconditioning, admin procedures, insurance, transport and financial costs. If you do not calculate all of this before buying, you won't know what margin you actually have left.
Not verifying the car's documentation before buying it. Seizures, retention of title, expired ITV (MOT), unpaid road taxes. Buying a car with hidden liabilities can block the sale and cause you losses. Always request a DGT report before closing a purchase.
Underestimating fixed costs. Rent, insurance, utilities, software, portals. Fixed costs add up fast. If you do not sell during the first few weeks (which is normal when starting), you need working capital to keep going.
Not having an invoicing system from day one. Issuing incorrect invoices, mixing REBU with the general regime, or failing to keep purchase documentation are errors that the Tax Agency can penalise. Set up your invoicing system before making your first sale, not after.
Relying on a single sales channel. If you only publish on one portal, you are limiting your reach. Diversify from the beginning: portals, own website, social media, Google Business.
More than 750 dealerships already use Dealcar to manage their business
From the platform, you can register your stock, automatically publish on the main portals, generate invoices with REBU or VAT, manage leads and monitor the margin of each operation. All in one place, without the need for multiple tools.
To manage your business from day one, visit dealcar.io/software-concesionario or you can book a free demo at dealcar.io.
Frequently asked questions
How much money do I need to set up a car dealership?
A realistic start-up with 5-8 cars in stock, functional premises and basic tools ranges between 30,000 and 60,000 euros. The largest expense is the initial stock. If you start with cheaper cars (below 5,000 euros purchase price), you can start with less investment, but the margin per unit will be lower.
What licences are needed to open a dealership?
Opening licence from the Town Hall, registration with the Tax Agency (form 036 or 037), registration with Social Security, and registration as a professional operator with the DGT to be able to carry out transfers. If you operate as an S.L., you also need a notary deed and registration in the Mercantile Registry.
Can I open a dealership from a car park or without premises?
It is legal if you comply with the activity licence and the municipal regulations of your area. Some municipalities allow car sales on open-air plots under the right conditions. But without presentable premises, your professional image and ability to attract walk-in clients will suffer.
Is it better to start as a sole trader or as a company?
If you are starting alone and with little stock, registering as a sole trader is quicker and cheaper. If you start with a partner, with a significant investment or with a forecast of rapid growth, an S.L. offers you more asset protection and can be more tax-advantageous in the medium term.
How do I get my first cars to sell?
The most common sources to start are direct purchases from private individuals (Wallapop, Milanuncios, contacts), professional auctions (BCA, Autorola) and the network of other dealerships. The important thing is to specialise in a segment and always calculate the total cost (purchase + reconditioning + admin procedures) before closing the deal.
