Carrying passengers who are there by their own choice is one thing. Carrying passengers who are paying you to take them somewhere is completely different.
When you get in a car with a friend, then you are willingly accepting risk, when you get into a taxi, then you are going to expect that the driver is properly licenced, the car is fully legal and that they are not going to put you in any unnecessary risk.
Any business has to have things that very few private individuals have. Do you have public liability insurance outside of you bog standard car insurance? If you seriously injure someone who is a mate along for the ride, then they have accepted some element of risk, so any claim they may make against you is going to be limited.
However, if someone is paying you, then they can go for you with full force.
There are many reasons why you need a CPL rather than a PPL, but that isn't all you need to carry fare paying passengers, you need the aircraft to be correctly maintained and in the right category and you also need an organisational structure that is approved by the CAA. They aren't there for your benefit, but for the passengers benefit (and the CAA's to be honest...)
Illegal public transport flights are something that gets taken extremely seriously and if you get caught doing it, then you are liable to end up in a whole heap of trouble.
BEagle has outlined the cost sharing that is allowed. Common coutesy doesn't come into it. In fact, I would never charge a friend for coming flying with me. They are my guest, that is my "common courtesy". They can offer of course, but I would never expect it or accept it.