Index
What exactly is a km0 and how does it differ from a nearly new or demo car
Error 1: Not checking the registration date before buying
Error 2: Not calculating the remaining manufacturer warranty
Error 3: Buying on price without verifying the actual equipment
Error 4: Assuming the origin of the kilometres without documenting it
Error 5: Not checking the condition of tyres and battery on stationary units
Error 6: Confusing the tax treatment of a km0 with that of a conventional used car
Error 7: Not putting in writing what the price includes in the sale to the customer
Error 8: Not standardising the handover process
Frequently asked questions
What exactly is a km0 and how does it differ from a nearly new or demo car
A km0 is a vehicle registered by an official dealership or by the importer, with very low mileage (usually less than 100-200 km), which is put up for sale as if it were new but with a discount on the list price. The prior registration allows the original dealership to count it as a sale to the manufacturer and access sales targets or bonuses.
It is not the same as a demonstration vehicle (demo), which has accumulated several thousand kilometres having been used for customer test drives, nor a management or executive vehicle, which has had real use by a brand or dealership executive for months. Nor is it a conventional nearly new car, which has had a private owner.
The practical difference for the buying dealership is important in three aspects: the manufacturer's warranty, the equipment, and the taxation. In all three, the km0 behaves in its own way, matching neither a new car nor a conventional used car.
Error 1: Not checking the registration date before buying
The registration date of a km0 determines the legal age of the vehicle for the purposes of warranty, taxation, and perceived value by the final buyer. A km0 registered 18 months ago, even if it only has 50 km on the clock, has a registered age of 18 months. This directly affects how much manufacturer warranty is left, the price you can ask for on the market, and the buyer's expectations.
Buying a km0 without verifying the registration date, trusting only that "it has very low mileage", is one of the most frequent and costly mistakes. A vehicle with a registration date from two years ago may only have one year of manufacturer warranty remaining, making it much less attractive than one registered three months ago with almost three years ahead.
Verification is immediate: the DGT report or the vehicle's registration certificate shows the date of first registration. Before closing any purchase of a km0, this information must be on the table and factored into the offer price.
To verify the full registration status of the vehicle before purchasing, including the registration date and potential charges, you can consult the article on how to check the MOT by registration plate and vehicle history.
Error 2: Not calculating the remaining manufacturer warranty
The manufacturer's warranty on a km0 starts running from the date of first registration, not from the date on which the final buyer acquires it. If the car was registered 14 months ago and the manufacturer offers a 3-year warranty, the final buyer has less than 2 years left. If this is not clearly communicated, complaints will arise when the buyer expected 3 years and takes the car to the workshop after 26 months only to find the warranty has already expired.
This issue has two layers. The first is the manufacturer's warranty (voluntary, conditional on servicing within the official network). The second is the legal warranty, which in Spain obliges the professional seller to be liable for lack of conformity for two years from delivery, and which can be reduced to one year by express agreement. Both can coexist in a km0 with different start dates: the legal warranty begins when you sell the car to the customer, whilst the manufacturer's warranty started when the original dealership registered it.
Documenting both separately in the sales contract with the customer, with clear start and end dates, prevents subsequent conflicts. For a detailed explanation of the differences between legal and commercial warranties, you can consult the article on legal warranty vs commercial warranty on cars.
Error 3: Buying on price without verifying the actual equipment
In a km0, the equipment is fixed: the vehicle has the configuration with which it was registered, and there is no option to modify it. Many dealerships buy km0 cars based on the model and price without verifying exactly what equipment that specific unit has. The problem arises when they try to resell it and the final buyer asks for features that are not included.
The same model can have versions with significant differences in equipment: with or without integrated navigation, with or without a sunroof, with or without an advanced driver assistance system (ADAS), with cloth or leather upholstery. In the new car market, the buyer can configure what they want. In a km0, what you see is what you get.
Before buying a km0, the vehicle's technical specification sheet must be checked against the model's equipment list to confirm which optional packs are included. This information must then be transferred, in detail, to the vehicle's record in the stock list so that the sales team does not have to assume or guess.
Error 4: Assuming the origin of the kilometres without documenting it
A km0 can have 30 km or it can have 250 km. The difference matters less than the origin. The kilometres from a logistics transport between the port and the dealership are different from the kilometres of a vehicle that has been used as a demo for weeks. The mechanical condition and wear are different, and the buyer has the right to know this.
The mistake is not that the vehicle has kilometres on it; it is not documenting their origin and not communicating it. If the buyer discovers after the purchase that the car was used for test drives for a period and has real mileage, they can make a claim. If that information was in the contract, they have no grounds to do so.
When buying a km0 from an official dealership or an importer, ask for the traceability of the kilometres. In most cases, they can provide it. If they cannot or will not, it is a red flag regarding the vehicle's history.
Error 5: Not checking the condition of tyres and battery on stationary units
A km0 that has been sitting in a warehouse or on a compound for months will have very low mileage but may present issues resulting from being stationary: tyre flat spots from static weight, a discharged or weakened battery due to lack of use, surface rust on the brake discs, or moisture accumulation in the brake fluid if it has been over a year since it was changed.
These problems are neither serious nor expensive to resolve, but they must be detected before the purchase or immediately after, not when the customer drives the car away and calls two days later because the battery will not start or they notice a vibration in the brakes.
For km0 vehicles with more than six months since registration, a handover inspection process that includes checking tyre pressures, visual inspection of tyres (including manufacturing date), a starting test, and fluid checks is a 30-minute investment that avoids unnecessary after-sales service issues.
Error 6: Confusing the tax treatment of a km0 with that of a conventional used car
The tax treatment of a km0 has specific particularities that are not always well known and which affect both the IEDMT (registration tax) and VAT.
IEDMT (registration tax). The km0 is already registered: the IEDMT was paid at the time by whoever registered the vehicle. The final buyer of a km0 does not pay IEDMT on the purchase, because the tax is levied on the first registration, which has already taken place. Likewise, if you acquire the km0 for your stock and then sell it, the final buyer does not pay IEDMT either, because the vehicle is already registered in Spain.
VAT. A km0 sold by an official dealership usually carries itemised VAT at 21% on the purchase invoice. If you deduct this VAT, you must apply the general scheme, not the REBU (Special Scheme for Used Goods), on the resale. You cannot apply REBU to the resale of a km0 purchased with itemised VAT.
ITP (Property Transfer Tax). The private buyer pays ITP when purchasing an already registered vehicle from a professional. If you sell the km0 to a private individual, that individual pays the ITP corresponding to their autonomous community based on the market value of the vehicle.
The most common confusion is trying to apply REBU to the resale of a km0 because "it has very low mileage and is practically new". The scheme does not depend on the condition of the vehicle but on the source of the purchase. If you bought it with itemised VAT and deducted it, the sales scheme is general. To review the full logic of the REBU and when it applies, you can consult the guide on when to invoice with VAT and when to apply REBU.
Error 7: Not putting in writing what the price includes in the sale to the customer
The km0 generates expectations of a brand-new product at a second-hand price. The final buyer often assumes it includes elements that are not covered: free first service, home delivery, transfer management, extended warranty, boot accessories, floor mats, etc.
When the buyer discovers that something they assumed was included is not, conflict arises exactly when you least want it: at the moment of handover or in the days that follow.
The solution is simple: include an "includes / does not include" block in the offer and in the car reservation contract, detailing the six or seven items that generate the most questions in your line of business. Transfer, first MOT, maintenance service, insurance, transport, additional warranty, accessories. What is included is mentioned. What is not, is also mentioned. This transparency does not deter sales: on the contrary, it reduces friction at the close because the buyer knows exactly what they are purchasing.
Error 8: Not standardising the handover process
The handover of a km0 has an emotional component that conventional nearly new cars do not always have. The buyer feels they are driving away a practically brand-new car and has expectations to match. If the handover is improvised, documentation is missing, or the car is not perfectly prepared, that expectation turns into disappointment and a negative review that quickly finds its way onto Google.
A standardised handover process for km0 covers three stages. First, the delivery note signed by both parties: exact mileage at the moment of handover, number of keys delivered, documentation included (registration certificate, manual, technical sheet), vehicle condition, and any relevant observations. Second, a five-minute explanation of the basic operation of the vehicle (especially if it has technologies the customer is unfamiliar with: ADAS, connectivity, charging management if it is electric or hybrid) and the warranty terms: duration, what is covered, and how to report an issue. Third, a follow-up 48-72 hours later to verify everything is fine, which is also the most appropriate time to request a Google review.
To organise this information within each vehicle's file and have it available at the moment of handover, you can see how inventory management in used car dealerships.
More than 750 dealerships already use Dealcar to manage their daily operations
Dealcar allows you to manage km0 vehicles with the same flow as the rest of your stock: complete record with actual equipment, registration date, linked documentation, correct tax scheme, and documented handover process. The entire team works with the same information, and every operation is logged for any subsequent reference.
If you want to see how it works, you can book a free demo at dealcar.io.
Frequently asked questions
Is a km0 taxed as new or used?
It depends on who sells it and how it was acquired. If sold by an official dealership that registered it in its name, it normally carries 21% VAT on the invoice. If resold by an independent dealership that purchased it with deductible VAT, they must also apply the general scheme with VAT. The REBU is not applicable to km0 cars purchased with itemised and deducted VAT.
How much legal warranty does a km0 bought from an independent dealership have?
The legal warranty is two years from delivery to the final buyer (it can be reduced to one year by express agreement). This is independent of the age of the registration. The manufacturer's warranty, on the other hand, started running from the first registration, and whatever remains at the time of sale is what corresponds to the buyer.
Does the buyer of a km0 pay ITP?
If the seller is a professional, the private buyer pays ITP (not VAT). The rate varies by autonomous community and is calculated on the market value of the vehicle according to the tables of the corresponding regional administration, not on the agreed transaction price.
Can I return a km0 to a dealership?
The law does not recognise a general right of withdrawal in the purchase of vehicles (this right applies to distance contracts or contracts concluded off-premises, but not to in-person purchases at a dealership). What applies is the legal warranty for lack of conformity if the vehicle presents defects. The specific terms of return, if any, must be agreed in writing in the contract.
Is it profitable to buy km0 cars for resale?
It depends on the difference between the purchase price from the official dealership and the market price in the resale channel, minus all costs. Km0 vehicles have less room for negotiation on purchase than conventional nearly new cars (the price is more standardised), but they offer a very attractive vehicle profile for the final buyer. The key is to carefully calculate the maximum purchase price for each unit based on the expected market price and the costs of the transaction.
