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Motor Dealer Licence – The Ultimate Guide

What is a Motor Dealers Licence?

A Motor Dealer Licence is needed if you intend to work as a motor dealer

What does it allow me to do?

The motor dealer licence allows you to:

  • sell a used vehicle (including its parts)
  • obtain a used vehicle (including vehicle parts) to sell, either as a complete unit or in parts
  • sell a used vehicle on behalf of another person (on consignment)
  • sell a leased vehicle to the lessee under the terms of the lease.
  • negotiate on a person’s behalf for that person to buy or sell a used motor vehicle.

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A used motor vehicle generally means:

  • motor vehicle that has been licensed or registered at any time
  • new motor vehicle registered for demonstration or sales promotion
  • used imported vehicle.

You may not act as a motor dealer until you get your licence. It is an offence to operate as a motor dealer while unlicensed.

The only exception to this rule is if:

  • you are offering a vehicle for sale as a private individual (not as a business operator or employee)
  • the sale is not a part of a business operation (for instance, selling for the purpose of earning profit).

What qualifications are needed to hold one

You must pass these training subjects from a recognised provider to apply for a licence. The only exception is if you’ve held an equivalent licence within the past 2 years.

You must do the training in modules from either:

  • Automotive Retail, Service and Repair Training Package—AUR modules (current modules)
  • Automotive Industry Retail, Service and Repair Training Package—AUR16 modules (superseded modules)

How to access the qualification

https://successresources.com.au/online-application-form/

How long is a Motor Dealers Licence

A Motor Dealers Licence course is self-paced. It contains nine units of competency.

Once you have passed the nine units of competency from a Registered Training Organisation you will receive your Statement of Attainment.

Once you have received your Statement of Attainment you will need to proceed to the Office of Fair Trading to apply for your Licence.

You can apply for either a one- or three-year Licence and pay the required fee.

Depending on which state you live in this usually takes 4-6 weeks to process. 

Pre-requisite requirements for holding a license state by state.

Qld – Eligibility

To be eligible for a motor dealer licence, you must:

  • be 18 or older
  • pass the required training courses.

Suitability

You are not suitable to hold a motor dealer licence if you:

  • are an insolvent under administration.
  • are currently disqualified from holding a licence or registration.
  • have been convicted of a serious offence in the past 5 years.
  • are subject to a court issued control order because of involvement in serious criminal activity. 

We also consider if you:

  • have a criminal history
  • have been an executive officer of a corporation (which was previously licensed) that has gone insolvent
  • were the subject of a successful claim fund action
  • have had your licence or registration certification cancelled or been suspended from holding one
  • have been previously disqualified from holding a licence or registration certificate
  • are disqualified from being a company director
  • have previously been an insolvent under administration
  • are incapable of satisfactorily doing the job of a licensee
  • are unsuitable because of your character or the character of your business associates
  • are allowed to work in Australia.

Serious offences

You are considered unsuitable if you have been found guilty of a serious offence in the past 5 years. A serious offence is anything punishable by 3 or more years in prison.

These include:

  • violent offences (including threats to use violence)
  • fraud and dishonesty
  • drug trafficking
  • extortion
  • arson
  • unlawful stalking
  • offences of a sexual nature
  • new offences under Queensland’s Criminal Code of
    • recruiting a person to become participant in criminal organisation
    • consorting
  • an offence committed with a serious organised crime circumstance of aggravation applicable to a prescribed list of offences within the meaning of the Penalties and Sentences Act 1992.

Receivership or liquidation

You must tell us if you have ever been an executive officer of a corporation that:

  • was previously licensed
  • has gone into receivership or liquidation.

You must also tell us:

  • what circumstances caused it to happen
  • whether you took all reasonable steps to avoid these circumstances
  • what assets you had available to distribute
  • how much money (if any) you paid in dividends
  • whether you broke any laws relating to these circumstances
  • whether you are disqualified from being a company director or other officer.

You must also include a report from the receiver or liquidator that gives us:

  • a detailed list of your creditors
  • the amount of money you still owe to each creditor.

Non-citizens

If you are not an Australian citizen or permanent resident, you need to:

  • give us a certified copy of your passport
  • have a visa that allows you to work in Australia.

Lodgement

When you lodge the form, you will need to attach formal identification. These documents must be original (if you lodge the form in person) or certified copies.

Your identification must be a certified copy of any of the following documents:

  • Birth certificate or extract
  • Driver licence
  • Passport
  • Citizenship certificate

You will need to pay certain fees when you lodge your application. These include:

  • the licence fee of $1,483.70 for 1 year or $2,781.70 for 3 years
  • a criminal history check fee of $39.45.

You will also need to attach proof of qualifications.

Places of business

You may have multiple places of business. You must register all of your business addresses when you apply for a licence. You must have a licensed person in charge at each place of business.

An individual cannot be in charge of more than 1 place at any given time unless the places of business are on adjacent blocks of land (not separated by a public road).

Find out more about places of business.

Criminal history check

To confirm your suitability, we will submit your application for a criminal history check. This will be thorough and may be time consuming.

If you were born in New Zealand or have a New Zealand passport, you need to get a copy of your criminal history or a letter indicating you have no criminal history from New Zealand. For more information, visit the New Zealand Ministry of Justice website.

You don’t have to pay any fees to get a New Zealand criminal history check. We can only accept original documents dated within one month of the date you send them to us. Please note it takes 20 working days to process a request for a New Zealand criminal history check.

Processing time

The processing time is 4–6 weeks. This can take longer if your application is not complete. This might be because of:

  • missing information
  • unpaid fees.

We will contact you if you submitted an incomplete application. You will need to complete the application before we can proceed. Otherwise, we may withdraw your application.

Pre-requisite requirements for holding a license state by state.

NSW -Eligibility

You must:

  • be at least 18 years of age
  • be considered fit and proper for the purposes of the licence (NSW Fair Trading checks and considers police records)Making it happen': NSW gets a new logo. Make sure you don't breach its publishing guidelines
  • not be disqualified from holding a licence as a result of a disciplinary action.
  • not be a controlled member of a declared organisation
  • not have been found guilty, in the past 10 years of a motor vehicle stealing offence.
  • not be bankrupt
  • have sufficient financial resources to carry on your business in accordance with the requirements of Fair Trading.
  • have approval from the relevant local council. 

What you need

  • nominated licence duration (1 or 3 years)
  • personal details of either the individual or business partners
  • business details, including the registered name of the business
  • ACN/ABN number 
  • the completed PDF form – ‘Manager’s Consent Form‘ (if applicable)
  • your payment.

How to apply

  1. Check the eligibility requirements.
  2. Select the ‘Apply online’ button.
  3. Sign into or create a OneGov account.
  4. Complete the online form.
  5. Attach the completed ‘Manager’s Consent Form’ (if applicable).
  6. Enter your payment details.
  7. Submit the online form.

If you’re unable to apply online:

  1. Download and complete Application for a Licence – PDF (including the Manager’s Consent Form section, if applicable).
  2. Submit your application with payment at a service centre.

More information

  • A corporation must nominate an individual to be manager of the day-to-day business of the licensee. An individual may manage the business themselves or nominate another individual to manage the business.
  • Where there is more than one manager, a separate Manager’s Consent Form must be completed for each manager.
  • Once you’re licensed as a motor dealer, you must display your licence name and number at your place of business, and publish them on any advertising or promotional material.
  • You don’t need a motor dealer licence for the following kinds of vehicles:
    • vehicles not acquired for the transport of goods or passengers on public roads (such as agricultural equipment)
    • vehicles with a mass over 4.5 tonnes (these are covered by the Heavy Vehicle National Law)
    • vehicles that are not capable of being registered in NSW, such as quad bikes, segways, motorised wheelchairs and battery powered bikes.

Pre-requisite requirements for holding a license state by state.

Victoria – Eligibility

To be eligible for a licence you must be:

  • at least 18 years old
  • likely to continue to have (and currently have) sufficient funds to carry on the business
  • a fit and proper person to be a licensed motor car trader
  • able to show that you have premises from which you can lawfully carry on business
  • likely to carry on business honestly and fairly
  • likely to maintain effective control of the business
  • able to show you have sufficient knowledge of the Motor Car Traders Act 1986 and the Motor Car Traders Regulations 2018 to carry on your business.

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Ineligibility

Sole traders, partnerships, partners, companies, and company directors must not:

  • be disqualified from holding a motor car trader’s licence (or equivalent) anywhere in Australia or elsewhere, or the subject of an order by any regulatory body disqualifying you from acting as a motor car trader or equivalent
  • be a director or officer of a corporation that is disqualified from holding a licence or have been a director or officer of a such a corporation when it was disqualified
  • be a represented person under the Guardianship and Administration Act 1986 – this means that a guardian and/or administrator has been appointed by the Victorian Civil and Administrative Tribunal to make legal or financial decisions for you
  • have been a partner, director or a person involved in managing a partnership or body corporate that has had a claim admitted against the Motor Car Traders Guarantee Fund
  • be insolvent or an externally administered company.

Sole traders, partnerships, partners, companies, and company directors are also deemed ineligible, but may apply for permission, if they:

  • within the last 10 years, have been convicted or found guilty and sentenced to a term of imprisonment of three months or more for the following serious offences:
    • fraud
    • dishonesty
    • drug trafficking
    • violence
    • have had a claim admitted against the Motor Car Traders Guarantee Fund

You must submit a consent form and certified copies of the required identity documents as part of your application.

Unlicensed trading

Unlicensed motor car traders are liable for significant fines.

Fees

The combined application fee and first annual licence fee for 1 July 2020 to 30 June 2021 is $2,542.90.

This fee must be paid at the time of application. The application fee is non-refundable

Additional documents required with the application

Sole traders

For you and all individual persons named as associates in the application form, you must attach the following documents:

For yourself, you must attach the following documents:

Partnerships

For each individual person who is a partner and each director of a company in the partnership, you must attach the following documents:

For the partnership, you must attach the following documents:

  • A completed Motor car traders partnership and company deed of indemnity (Word, 1.2MB) signed by each partner.
  • A copy of the last monthly statement for each bank account held by the partnership confirming the availability of funds.
  • A copy of a current bank statement for any loan account or a loan approval letter from the credit provider.
  • A current copy of the trading statement of the partnership (balance sheet and profit and loss statement – no older than six months from the date of this application.
  • A completed Motor car traders estimated cash flow projection for the first 12 months of trading template (Excel, 23KB) or Motor car traders estimated cash flow projection for the first 12 months of trading template (Word, 116KB). The BLA requires this document to demonstrate you have fully considered the costs of running a motor car business and have a clear view of the kind of profit you are likely to make over your first year of trade.
  • If the partnership or a partner is currently trading in any other business (e.g. panel beating, mechanical workshop or non-motor car related business), a copy of the balance sheet and profit and loss statement for the last financial year. A balance sheet is still required even if the partnership was only recently formed.
  • Unless a licensed motor car trader has occupied the premises within the last six months prior to this application, for each of the proposed trading premises you must provide a current planning permit or a letter from the appropriate local council indicating that you can lawfully carry on a motor car trading business at each premises.
  • Lease agreement or contract of sale (depending on circumstance).

For all individual persons named as associates in this form, you must attach the following documents:

Companies

For each director, you must attach the following documents:

  • A completed Consent to national criminal history and other record checks (Word, 517KB).
  • Certified copies of the required identification documents. Details are on the Consent to national criminal history and other record checks form.
  • A completed declaration of personal finances – included in the Motor car traders proposed business plan (Word, 186KB). The BLA needs certain information to determine whether you have sufficient financial resources to trade in motor cars. Your application cannot proceed without it. Each director is required to complete their own declaration of personal finances.
  • A copy of a current bank statement confirming availability of funds for each bank account. The statement must show the account holder’s name.
  • A copy of a current bank statement for any loan account including mortgages or a loan approval letter from the credit provider.
  • A copy of the most recent council rates notice for any property held by the director.

For the company, you must attach the following documents:

  • A completed Motor car traders partnership and company deed of indemnity (Word, 1.2MB) signed by each director.
  • A copy of the last monthly statement for each bank account held by the company confirming the availability of funds.
  • A copy of a current bank statement for any loan account or a loan approval letter from the credit provider.
  • A current copy of the trading statement of the company (balance sheet and profit and loss statement) – no older than six months from the date of this application.
  • A completed Motor car traders estimated cash flow projection for the first 12 months of trading template (Excel, 23KB) or Motor car traders estimated cash flow projection for the first 12 months of trading template (Word, 116KB). The BLA requires this document to demonstrate you have fully considered the costs of running a motor car business and have a clear view of the kind of profit you are likely to make over your first year of trade.
  • A completed Motor car traders proposed business plan (Word, 186KB). The BLA needs certain information to determine whether you have sufficient financial resources to trade in motor cars. Your application cannot proceed without it.
  • If the company or a company director is currently trading in any other business (e.g. panel beating, mechanical workshop or non-motor car related business), a copy of the balance sheet and profit and loss statement for the last financial year. A company balance sheet is still required even if the company was only recently incorporated.
  • Unless a licensed motor car trader has occupied the premises within the last six months prior to this application, for each of the proposed trading premises you must provide a current planning permit or a letter from the appropriate local council indicating that you can lawfully carry on a motor car trading business at each premises.
  • Lease agreement and/or contract of sale (depending on circumstance).

Pre-requisite requirements for holding a license state by state.

ACT -ELIGIBILTY

To be eligible for this licence you must:

  • be at least 18 years of age
  • complete the online application form
  • have not contravened law
  • had no finding of guilt for fraud or dishonest conduct
  • have not contravened any conditions of your current or previous licence
  • have not been refused a licence in the past
  • disclose any experience in managing a company which has been insolvent
  • disclose any personal history of bankruptcy 
  • pay the prescribed fee.

For a dealer or wholesaler licence, the applicant must also provide information regarding:

  • the entity’s material and financial resources
  • the scope of the proposed business activity
  • any legal responsibilities which may arise through carrying out the business activity.

Requirements will vary if you apply for the licence as a corporation or an individual. Please consult the Contact Officer for more information regarding eligibility requirements.

Pre-requisite requirements for holding a license state by state.

WA -ELIGIBILITY 

To obtain a motor vehicle dealer licence, you must:

  • Complete the application form.
  • Pay the appropriate fee.
  • Identify (in the application form) the category/ies of licence you are seeking.
  • Successfully complete the motor vehicle dealer licensing course conducted by an accepted training provider (in the case of a partnership or corporation, this includes any partner or director engaged in the day-to-day running of the dealership).
  • Satisfy the Commissioner that you have sufficient resources to meet the obligations for the category/ies of licence you are applying for. For this to occur, the Commissioner will obtain a credit history report on the applicant.
  • Provide a National Police Certificate (less than three months old) for each individual (sole proprietor, partners or directors of a corporation) associated with the application. This will be used to consider whether the persons concerned in the management or conduct of the entity are of ‘good character and repute’ and ‘fit and proper persons’ to be in the business of buying and selling vehicles.
  • Specify the dealers’ premises where you propose to carry on business.
  • Register the business name (if applicable).
  • Register the company (if applicable).

Pre-requisite requirements for holding a license state by state.

SA -ELIGIBILTY

  • sole traders
  • companies – the company and the manager must have separate licences
  • partnerships – each partner must have a separate licence
  • motor wreckers and crash repairers – even if they are only selling vehicles that can’t be driven because they need repairs

Offences and convictions

You may not be able to register if you (or a director of the company) has been convicted of an indictable offence of dishonesty or convicted of a summary offence of dishonesty within the past 10 years. 

When you don’t need a licence

You don’t need licence if:

  • you are a recognised credit provider and selling second-hand vehicles is a result of the business
  • you are an auctioneer selling on behalf of people who do not need a licence.
  • you only sell vehicles that:
    • weigh more than 3,000 kg
    • are designed for agricultural or industrial use
    • can’t be used to transport on land – eg boats
    • are not powered by an engine – eg caravans.

Pre-requisite requirements for holding a license state by state.

TASMANIA

Anyone who buys, sells or exchanges 6 or more vehicles in a year must be licensed as a motor vehicle trader.

A motor vehicle trader licence is valid for 3 years.

 

How to become a used car dealer

The first step on your journey to becoming a Used Car dealer is to contact a Registered Training Organisation and apply to do your Dealer Licence course

This consists of nine units of competency and the course is self-paced.

Success Resources International are a leading provider of this course. They can be contacted via email admin@successresources.com.au or by phone on 07 38075506.

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Once you have completed the course you will receive a Statement of Attainment. 

This will need to be taken to the Office of Fair Trading with a Form 1-1 and 100 points of ID.

From there you will pay a fee for your Licence and await processing which usually takes between 4-6 weeks depending on your circumstances.

 

How many cars can I sell per year?

Qld – Generally, you are allowed to sell no more than four vehicles per year without having an auto dealers license under Department of Licensing (DOL) guidelines

ACT – dealer (where more than six vehicles are bought, sold or exchanged in a 12-month period)

SA – Second-hand vehicle dealers must have a licence if they buy, sell or offer for sale four or more vehicles in 12 months. Unlicensed dealers can be prosecuted, and penalties include fines and imprisonment.

TASMANIA – Anyone who buys, sells or exchanges 6 or more vehicles in a year must be licensed as a motor vehicle trader.

NSW – Generally, you are allowed to sell no more than four vehicles per year. 

VICTORIA – If you deal in four or more cars per year, you need a licence. 

WA – You cannot sell more than 4 vehicles registered to you in any 12-month period.

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