The ban on cash payments for the purchase of scrap metals came into effect on November 5, 2018. The ban comes in the wake of rising concerns about car theft and the undocumented – and untaxed – sale of scrap cars for cash.
What Is the Cash for Scrap Cars Business Model?
Cash for Scrap Car is a business model in which scrap car owners could easily get rid of their unwanted cars for cash. The cash for car buyers bought the scrap car for cash, providing scrap car owners with an easy avenue to get some quick cash.
The Need for The Cash Ban
But, while the cash for car business model worked well for the scrap car sellers and cash for car dealers, there were concerns from the government about undocumented sales and the increase in the number of car thefts. The NSW government wanted to regulate the scrap metal industry, making it difficult, if not impossible, for illegal cash for car dealers to operate. And that is the primary reason for the introduction of the cash ban.
No More Cash Payments for Scrap Metals
Going forward, whether it’s some batteries, some household appliances or an old car, all scrap metal purchases will have to be properly documented. A scrap metal buyer can only make payments via EFTPOS or through cheques. Cash payments are strictly prohibited and failure to follow the law can invite a fine of up to $30,000.
Police Have More Power
Under the new laws, the police now have the power to enter and search a car wrecking and recycling yard without a warrant, if they suspect illegal activities are taking place.
Crackdown on Tax Evasion
Another major complaint levied against the scrap metal industry was that it wasn’t properly regulated, which meant unscrupulous cash for car or scrap metal buyers could easily evade tax. The new laws will ensure that the NSW Government will no longer be missing out on the tax revenue from the scrap metal industry, as transactions will now be strictly monitored.
Only Deal with Licensed Cash for Car Dealers
If you’re a car seller with an old, unwanted or damaged car to sell, be sure to find a legitimate, licensed cash for car dealer to do business with. Registered cash for car companies like Sydney Wide Cash for Cars offer car sellers a hassle-free car sale, complete with proper documentation.
To get a quick cash for cars quote for your car, give us a call at 0434 450 140