Charging your Pax

[Guest SAJabiruflyer]

Ahhhh I could go hunting through the RA-Aus rules, but what fun would that be when there are hundreds of people on here to ask!! I've got many friends who wish to come flying with me, but to be honest I dont feel I can sustain the cost of weekly flying (house, wife, wife's shoes, wife's clothes etc). I'd like to have them pay me half of the cost of plane hire, but im aware I cant use my licence for financial reward. However im sure it would be fine to have a friend contribute to the hire cost - or would it? Is there some fine print out there that would get my butt in trouble. What if someone said to me "Hey Brett, I'll cover the hire cost if u fly me". Im sure there must be a grey area, so any comments would be appreciated. Apologies if i've been too lazy to hunt around for info.

 

 

[Powerin]

You are allowed to equally share the cost of your flight with your passengers. So in an RAAus aircraft (ie 2 seats) you can legally ask your passenger to pay only half of the costs of the aircraft (fuel, hire etc). You cannot charge anything for your services as pilot.

 

 

[Guest SAJabiruflyer]

Thanks guys, who needs to wade through 500 pages of rules when an answer can be easily had here!

 

 

[Guest basscheffers]

In the GA case of course because there can be more bums, the costs must be shared equally among them.

Not quite: the rule is that the pilot may pay no less than their share, E.g: I recently went up in a 172 with a PPL friend, my brother and his daughter. The pilot paid his 25% and I paid the rest.

 

 

[djpacro]

More than not quite:

 

[facthunter]

It seems to say COSTS. So far you have only talked of fuel costs (unless I've missed something). Often when you hire an aircraft you pay the fuel in the hire rate. Would your costs there be Hire rate x flight time divided amongst all occupants? Similarly in an owned aircraft there should be fixed hourly costs and costs not related to hourly use..Nev

 

 

[sseeker]

^^What David said!

 

This issue was dicussed in my post here: http://www.recreationalflying.com/threads/advertising-your-flight.16771/ (along with ADVERTISING your flight, I suggest you have a read.)

 

-Andrew

 

 

[Guest basscheffers]

Similarly in an owned aircraft there should be fixed hourly costs and costs not related to hourly use..Nev

Yup, don't forget the hangar, insurance, interest on the loan, etc. If you own an aircraft, I would say a "defensible position" would be to take the market value of hiring a similar aircraft. I.e.: if you keep your personal Jabiru at YZZZ and a school on the field hires the same model out for $130 wet, nobody is going to argue with you charging your passenger $65.

It's hard to get in trouble cost sharing, assuming you aren't doing anything blatantly commercial and/or publicly advertising to offset your costs.

 

 

[Guest SAJabiruflyer]

Has anyone seen a lid I can use to cover up the can of worms I just released?? :head_hurts::head_hurts::head_hurts:

 

 

[Bryon]

If I fly my plane, the passenger pays half of my costs, if I hire a flight school plane, the passenger pays half the costs, simple.

 

I am in a syndicate and we have a fixed cost to fly the plane per hour, the pax pays half that cost

 

Dont get confused

 

Half is half

 

Cheers

 

Bryon

 

 

[Guest davidh10]

... I would say a "defensible position" would be to take the market value of hiring a similar aircraft. I.e.: if you keep your personal Jabiru at YZZZ and a school on the field hires the same model out for $130 wet, nobody is going to argue with you charging your passenger $65.It's hard to get in trouble cost sharing, assuming you aren't doing anything blatantly commercial and/or publicly advertising to offset your costs.

The flying school is presumably making a profit from the hire, so I doubt you could claim to use half their price as representing half your cost. Although you would not be making a profit, the half profit component would mean the PAX was paying more than half the cost. On the other hand, the flying school has tax deductions whereas you don't...

 

Wouldn't it just be simpler to add up your outgoings over a year and divide by the number of hours per year you are currently flying. Again, it may not be exact, but the approach should hold water.

 

 

[facthunter]

It would be unlikely that an individual owner could operate a plane for less than a school due to under utilisation. The fixed costs assume a larger percentage of the total and translate to a higher figure per hour.. Offsetting that, the school plane may be better insured and maintained than the privately owned aircraft. If you want to be fair dinkum about it you could derive an hourly rate for your plane, if you set about it properly. You have to allow an amount for engine time and wear and tear on the plane and depreciation. Everything must be included. Nev

 

 

[Guest basscheffers]

What Nev said. :)

 

Using that method, you will likely end up with a reasonable figure that is more than just the obvious costs and less than it actually is, taking everything into account. Good way to stay out of trouble for the lazy and or mathematically challenged!

 

 

[Tomo]

Use a bit of common sense too, I reckon... basically they don't want you being commercial, in other words, you get a benefit out of others, financially, hourly etc...

 

I fly family and close friends around for no cost, and no, I'm not doing anything illegal by doing that! And no I'm not cost sharing there, am I?...

 

 

[Guest davidh10]

...I fly family and close friends around for no cost, and no, I'm not doing anything illegal by doing that! And no I'm not cost sharing there, am I?...

Likewise, Tomo. Like I tell people... The seat is going with me anyway!

 

 

[fly_tornado]

So if you have a paying passenger, won't you fly more?

 

 

[Tomo]

So if you have a paying passenger, won't you fly more?

Certainly, it makes it quite affordable flying if going halves or whatever. But the point I was making is - it's all good to say you 'must' cost share or else. But it's not always relevant, use a bit of common sense, and just don't be commercial! My dictionary states that as: making or intended to make a profit

 

 

[FlyingVizsla]

The cost sharing can happen, but you have to be seen to be doing it the right way. For example, don't put up a notice offering to take people for $/hr. If you do take someone it would be better to arrange something outside of the flying to help with the compensation eg as a mate he can drop off a load of soil, or buy you & the family dinner (but don't put that in writing!). You get yourself into strife when you start trying to justify the charge (it should be a mutually agreed 50/50 share). It is best to each put in cash and then divvy it up for fuel, landing fees, etc. I think you could be on shaky ground claiming 1/365th of insurance, hangar, rego, depreciation, licencing, member fees etc, especially where that ends up with the passenger forking over all the cash and the pilot's share being "book" values.

 

 

Now CASA have a long history with GA "cost sharing" and "commercial use" prosecutions. I have not gone back to find the issues, but in AOPA years ago there were several cases. From memory (and it is getting a bit spongy) one case involved a pilot and 3 passengers. Each put in equal cash shares but one passenger paid for the other as she was his secretary. Was then deemed commercial (a business / work arrangement was happening) and not strictly cost sharing. Another where the passenger paid for fuel etc and the pilot contributed his services - again not strictly cost sharing as his services can't be valued as it is a private operation - can't value it as time away from earning a living at his business etc.

 

So there we go - a cesspit of mire just waiting for a customer.

 

Sue.

 

 

[Guest davidh10]

So if you have a paying passenger, won't you fly more?

No. Time is the limiting factor for me. I flew on three days last week and was busy with family things at the weekend. This week, so far the cloud base is at circuit height and it's raining.

I also understand that anyone hiring an aircraft would have higher immediate and out-of-pocket costs. As I own my aircraft, it is a depreciating asset so my direct costs are for consumables (mainly fuel) and hangarage.... in roughly equal proportions. I doubt that private depreciation or market rate interest foregone are allowable as costs for this purpose.

 

As Tomo said, just because you can cost share, does not mean you have to, but also as FlyingVizsla said, if you do, be careful to ensure that there is no unwitting profit or business / commercial taint to the transaction. Obviously it can be judged as commercial even if you make a loss on the transaction, based on the relationship of the passengers and / or pilot.

 

 

[Guest ozzie]

Ahh, the joys of owning a single seat aircraft. No Klingons!

 

 

[sfGnome]

Like Dex, I have a ring-around list when I go, but if I'm going to be 'practising my scales' then I don't drag anyone along. When I first got my cert, I had lots of people wanting to come along for a ride so I just told them that I'd be happy to take anyone anywhere in Aus, but they had to pay half costs. Strangely, the requests dried up instantly. Now I just get to take the people I ask, and I haven't asked anyone for a cent yet.

 

 

[rocket1172]

Tomo's definition of commercial.........I like. Can somebody tell me if I am allowed to "hire" my aircraft out to other pilots to fly as long as it is not "commercially"? Or........what if somebody "hire's" the aircraft, but I fly them from A to B etc? Thoughts?

 

 

[Tomo]

Can somebody tell me if I am allowed to "hire" my aircraft out to other pilots to fly as long as it is not "commercially"? Or........what if somebody "hire's" the aircraft, but I fly them from A to B etc? Thoughts?

Instead of having pages of it all again... I'd like to refer you over here http://www.recreationalflying.com/threads/advertising-your-flight.16771/ ... scroll down a bit and you'll see where it was discussed a fair bit last time. I think there may be some answers there for you.

 

 

[rocket1172]

Your a legend Tomo! Thank you. Rod.

 

 

[Tomo]

Your a legend Tomo! Thank you. Rod.

Thanks Rod, but I can't take all the credit, as Sseeker found the link first, and posted that back a bit.

 

Hope you're having a great day! :thumb_up: