New PPL holder, confused about rules on Aircraft hire cost sharing with PAX?

[RyanRs]

Hi, I recently passed my PPL and now am looking for affordable ways to build hours / experience with the eventual aim to do a modular ATPL. I fully understand that without a CPL i cannot use an aircraft for any profit or reward, however i am allowed to evenly spread the costs of aircraft hire with my pax.

Now, using this theory i had an idea of spreading the word through family,friends, friends of friends and beyond etc that i can do 'cheap' trips for anyone who fancied an experience in a light aircraft; wanted to fly over there house, see the local area etc.. I would share the cost evenly between myself and all pax so therefore i am not making any profit from it and in theory not breaking any rules! this way i can get my personal hourly rates down to almost £45 per hour! However, i have been told that this is not allowed, I did not get a reason why, just told by my flying club that its a no and the CAA will find out if i did it!!

Also, does the cost of hire have to be split evenly? not being greedy, just would like to know what i can and cant do. After all, if i took 2 pax in a pa28 and charged them £75 each , leaving £25 to pay myself then they are still getting an hour in a pa28 for £50~£60 cheaper than they would get it if they did a pleasure flight with a school and obviously flying for me becomes very cheap!

So, am i allowed to do any of this or not? the 'pleasure flight' idea tbh i cannot see why i cant do it as like i stated, i profit nothing from it financially. Can anyone clear this up for me?

Thanks
Ryan

[Ds3]

The costs have to be split evenly - you cannot ask for payment of more than an share of the direct costs of the flight proportionately split between the number of people on board.

The flight canont be advertised in any way, otherwise it is considered that you are offering and subsequently providing a public service.

You are profiting financially from it, as you are having the costs of your flight paid for by someone else.

[Okavango]

Note in particular it's the DIRECT costs (fuel, landing fees etc), so unless you're flying a lot and in which case more than likely on the CAA radar, the fixed element will still take quite a chunk of the effective hourly rate you see and have to be out of your own pocket.

Interestingly, even with a CPL this particular situation doesn't change so much as for public transport you'd still need an AOC. So with a CPL your only option is to work for someone with an AOC or be paid by private aircraft owners (which I'd assume is a very small market!). There ain't no easy wins!!

[PA28181]

The "Direct Cost" element is confusing to say the least. If you take family/friends along to your favourite airfield and take your regular PA28 for example, and it's rate is £100, Who is going to know or care what the "Direct" cost is, 4 POB £100/4 =£25 That's what you will be charged.

Are the CAA saying you will have to confirm with the owner/operator of acrft what the cost of fuel/oil/maintenance is, to work out the real cost?

Don't think so but as usual with aviation, could be wrong.

I don't give a monkeys, what the direct cost is and would divide up the hourly rate I'm paying equally between POB (Haven't done it for years though as too much hassle with non flyers)

[Ebbie 2003]

Not cure about the rules in the UK but there is one other requirement for those doing cost share on an FAA PPL - that is common purpose.

All those on the flight must have a common purpose in participating in the flighg.

So all going on a trip to the beach - no problem. All going for a jolly up the coast - no problem. Dropping off friends at their holiday home - not a common purpose. Taking a friend to a business meeting - not a common purpose - you want flight hours, he needs to get to his meeting.

For those building hours without a commercial license breaching this requirement is more breached than observed - never heard of a anyone falling foul of it and having an enforcement action.

[PA28181]

Quote. for those doing cost share on an FAA PPL - that is common purpose.


Does that apply to using an FAA PPL in the UK?

[172driver]

Does that apply to using an FAA PPL in the UK?

I'd say 'yes', as you are an FAA certificated pilot, therefore you have to adhere to FAA rules & regs.

[darkroomsource]

Quote. for those doing cost share on an FAA PPL - that is common purpose.
Does that apply to using an FAA PPL in the UK?
Yes, it does.

[Whopity]

The costs have to be split evenlyNot true, the pilot must pay his share based upon the number of passengers, but how the passengers divide the remainder is entirely up to them! Art 267 (3) The criteria in this paragraph are satisfied if:
(a) no more than four persons (including the pilot) are carried;
(b) the proportion which the contribution referred to in paragraph (2)(c) bears to the
direct costs is not more than the proportion which the number of persons carried
on the flight (excluding the pilot) bears to the number of persons carried
(including the pilot);

[PA28181]

Still don't know what the "Direct Cost" means???

[Johnm]

Still don't know what the "Direct Cost" means???

Essentially costs related only to the specific flight excluding those costs incurred annually and possibly amortised per hour which are sometimes called fixed costs.

So direct costs would be fuel, oil, landing and approach fees, parking fees, handling fees.

Fixed costs would be insurance, hangarage, maintenance.

Basically if I carry passengers and they volounteer to share I let them pay landing fees and parking fees and a contribution to fuel so I'm confident they aren't paying more than they should. I was going anyway, so their company and few quid is a bonus and that's how you have to look at it.

[PA28181]

So I know the landing,approach, parking etc, Do I now have to ask the owner/operator for how much fuel and oil I have burnt on my epic flight of an hour or two. Because I am a good pilot I always mixture lean when appropriate, and until the acrft is refueled/oiled I have no idea how to work out the direct cost.

Of course I know exactly what the cost to me is when flying my regular aircraft but that is not the point. Some may not...

Another load of CAA/EASA bolloeux. Would still use the hourly flying rate anyway.

[Level Attitude]

Still don't know what the "Direct Cost" means???
The Direct Costs of a flight are those costs, that a pilot has to pay,
arising solely due to that particular flight being undertaken.

Eg:
Hiring an aircraft from a club/school.
Direct Costs = Total cost of Hire (How the club then spends the money
is irrelevant) + Landing Fees (if any)

Sole Private Owner
Direct Costs = Costs of consumables (Fuel, poss Oil, poss de-ice fluid)
used on that flight + Landing Fees (if any)

No part of general ownership cost (maintenance, hangerage. insurance,
etc) counts

Part Owner of Group Shared Aircraft
Direct Costs = What the Group rules state an owner is required
to pay for a flight + Landing Fees (if any)

No part of general ownership cost (including any monthly subscriptions
to the Group) count as direct costs

NB: Some people argue that Landing Fees do not form part of the
Direct Cost of a flight and passengers can, therefore, be asked to
pay them in full (not sure I agree with that)

[PA28181]

So, If what is said is true. Then flying clubs hiring to a club member will charge the going hourly rate which includes all the associated costs of fuel, oil, maintenance, parking, landing card if applicable, etc, and the hiring punter can can then divide up the cost between the POB. As per the rules.

But. If your own the aircraft you are disadvantaged immediately because you can't include probably the largest expense of running an acrft ie: the maintenance, hangerage, insurance etc, doesn't seem right does it?

[Level Attitude]

2 pax in a pa28 and charged them £75 each , leaving £25 to pay myself
this way i can get my personal hourly rates down to almost £45 per hour!
i cannot see why i cant do it as like i stated, i profit nothing from it financially.

RyanRs
Read the quotes above which are from your original post.
You would be profiting. To the tune of £135 per flight hour !
(calculated from first quote above)

Your original query comes up fairly regularly from new PPLs.
Full marks to your Flying Club for putting you straight.

NB: £175 per hour (calculated from first quote above) is rather high
for 'PPL' hire of a PA28 - Is this perhaps the Dual rate?

[Steve6443]

I'm sorry to have to add to the confusion but in Germany there is quite an uproar because of new rules which have been implemented with effect 8th April 2013 and - if not already in effect in UK - will be brought into effect shortly. The effect of this legislation is that it becomes illegal to fly whilst sharing costs, even if the pilot pays 99.99999% of the costs. It has had the effect of stopping non commercial flying clubs from offering flights at ANY cost to non club members, for example as part of an open day.

FCL 205.a is quite clear in stating the following:

"FCL.205.A PPL(A) — Privileges

(a) The privileges of the holder of a PPL(A) are to act without remuneration as PIC or co-pilot on aeroplanes or TMGs engaged in non-commercial operations."

The key words here are "non-commercial" and "without remuneration".

It does NOT refer to "sharing costs" but "without remuneration" and this means you are NOT allowed to receive any money whatsoever for the flight, irrespective of whether it covers some or all of the fixed costs.

Now, some people say: we have club members who have CPLs, why don't the CPLs take the guests, the money goes to the club? Unfortunately this is where the whole thing gets messy as we have to take into consideration of Basic Regulations 216/200 which describes commercial flying as:

commercial operation’ shall mean any operation of an aircraft, in return for remuneration or other valuable consideration, which is available to the public or, when not made available to the public, which is performed under a contract between an operator and a customer, where the latter has no control over the operator;

and

European Regulation 965/2012 which states:

‘commercial air transport (CAT) operation’ means an aircraft operation to transport passengers, cargo or mail for remun* eration or other valuable consideration;

As private flying clubs are (usually) not in operation for any commercial business, the CPL cannot be exercising his rights as a CPL when flying for a non commercial operation, hence he is exercising his rights as a PPL, not a CPL.

Therefore, the only flight you can offer to a friend / associate / colleague / whatever is one YOU pay for, without any contribution, UNLESS you are a CPL working for a commercial air transport operation. Anything else and you are infringing the rights of a PPL.

In Germany, it has killed the pleasure flight market for flying schools and lead to a demise of cost sharing flights; however the AOPA has stated that it is pushing the EASA to change the Basic Regulation to allow "occassional paid transport of passengers, VFR, from point A to point A" by CPL licence holders, but this will probably not happen before 2015; also note this is ONLY for CPLs, not PPLs and for the benefit of flying clubs, not individuals. Any transaction involving the movement of cash / other recompense from the passenger to the pilot will still infringe the rights of the PPL.

Of course, the issue will be proving such things take place - at a club with ledgers, it's easy to see if they infringe these legislations because monies received in exchange for flights will appear; should you then fly for the club, talking people for a paid joy ride in a plane, you will be leaving yourself open to prosecution. As a PPL using a chartered or your own plane and having cash changing hands "under the counter", it will be much more difficult to prove......

[Flying Lawyer]

Air Navigation Order 2009
PART 34
Public Transport and Aerial Work
Public transport and aerial work – exceptions – cost sharing

267

(1) Subject to paragraph (4), a flight is a private flight if—
(a) the only valuable consideration given or promised for the flight or the purpose of the flight is of a sort described in paragraph (2); and
(b) the criteria in paragraph (3) are satisfied.

(2) Valuable consideration is of a sort described in this paragraph if it is one or more of the following—
(a) valuable consideration specified in article 262(1);
(b) in the case of an aircraft owned in accordance with article 269(2), valuable consideration which falls within article 269(3); or
(c) a contribution to the direct costs of the flight otherwise payable by the pilot in command.

(3) The criteria in this paragraph are satisfied if —

(a) no more than four persons (including the pilot) are carried;

(b) the proportion which the contribution referred to in paragraph (2)(c) bears to the direct costs is not more than the proportion which the number of persons carried on the flight (excluding the pilot) bears to the number of persons carried (including the pilot);

(c) no information has been published or advertised before the commencement of the flight other than, in the case of an aircraft operated by a flying club, advertising wholly within the premises of such a flying club in which case all the persons carried on such a flight who are aged 18 years or over must be members of that flying club; and

(d)no person acting as a pilot is employed as a pilot by, or is a party to a contract for the provision of services as a pilot with, the operator of the aircraft which is being flown.

(4) If valuable consideration specified in article 262(1) is given or promised the flight is a public transport flight for the purposes of Part 3 and Part 4 (other than articles 37(2) and 39(2)).



http://www.caa.co.uk/css/img/caalogo.jpg Secretary & Legal Adviser’s Office – May 2010 :

SUMMARY OF THE MEANING OF COMMERCIAL AIR TRANSPORT, PUBLIC TRANSPORT & AERIAL WORK
This paper is a summary of the meaning of commercial air transport, public transport and aerial work in the Air Navigation Order 2009. It is simplified and it is of course the Order itself which must be relied upon.

6.3 Exception No 3 - Cost sharing (Article 267)
6.3.1
A flight will be a private flight for all purposes if the only payment is a contribution to the direct costs of the flight (not annual costs) otherwise payable by the pilot in command. This is provided –

(a) no more than four persons (including the pilot) are carried

(b) the pilot pays at least a proportionate share (e.g. if four persons are carried the pilot must pay at least 25% of the direct costs) and

(c) the flight has not been publicised in any way except within the premises of a flying club (in which case all the adult persons being carried in the aircraft must be members of that flying club).

6.3.2
There is a further proviso that a pilot cannot take advantage of this exception if employed as a pilot by the operator of the aircraft. This is intended to deter flying instructors from abusing the exception by offering quasi-public transport flights in aircraft of the flying club for which they work.


NB:

The conditions for cost sharing are fully set out in the helpful CAA summary above.

People often mistakenly refer to conditions and/or prohibitions that do not exist. eg There is no mention of 'friends', 'family', 'friends of friends' or 'strangers'.

The pilot must pay at least his/her proportion of the direct costs of the flight (relative to the number of passengers).
There is no restriction upon how the passengers' proportion is divided between them.



FL

[PA28181]

Cut & paste is good isn't it. Still doesn't answer my previous post. Are the direct costs of the hiring club relevant or just to the private owner?

If three of the 4 POB are 17yrs 11 mnths then does the P1 pay all of it?

[BackPacker]

Steve6443, you might want to check the exact wording of that FCL article both in English and in German. I heard a rumour (and since this is a rumour site I'll propagate it here) that the EU has started using automated translation between the various languages, and that this doesn't always work perfectly. And even with manual translation, does a word such as "renumeration" always gets translated properly in each of the 20+ languages of the EU? Do these other countries even have enough words to express the nuances properly? (Remember the Eskimos have more than 50 different words for snow. How would you translate each of those words into, say, Spanish, without losing at least some of the meaning and nuance?)

The result of this may well be that the German text of EASA-FCL is ever so slightly different from the English version, even though they are supposed to be the same. And that may lead to interpretation differences, which (aviation being what it is) may be wholly blown out of proportion.

Anyway, I just checked the exact meaning and different dictionaries have different synonyms for "renumeration". One synonym is "pay" and the other is "recompense". I'm not a language specialist but to me, "pay" means I end up with more money in my wallet than what I started out with before the flight, and "recompense" means my costs have been paid and my wallet contents have remained unchanged. Depending on the exact interpretation of the word "renumeration", cost sharing may or may not be illegal according to the English version of EASA-FCL. Want to do the German, French and Dutch text next?

[Flying Lawyer]

PA28181Cut & paste is good isn't it.

Hmm. Interesting.
Clever enough to be sarcastic, but not clever enough to read the legislation and work it out for yourself. :rolleyes:

I posted the relevant law and the associated CAA commentary in order to draw attention to some common errors/misunderstandings concerning cost sharing.
I no longer give legal advice.


FL

[abgd]

My reading of 'remuneration' was the same as Backpacker's... in which case you could argue that the passengers could actually meet the full cost of the flight which has previously been the case in parts of Eastern Europe and perhaps elsewhere.

Either way, most pilots are not lawyers, and it's reasonable to expect official guidance or clarification for situations like these.

Equally to the point, how many passengers does the OP expect to find who will want to pay what remains quite a large sum of money to subsidise their flying? Nice if people want to help out financially once in a while, but I think I'd find it hard to find enough people who wanted to come out to help significantly. Added to which, most members of the public will want to go out on pleasure flights round the local area, and not necessarily the sort of trips you would want to plan as part of hour-building.

[PA28181]

read the legislation, what a cop out from a lawyer.

If we could all be as good as you, you would be out of work.

I have read it and it still doesn't answer my previous.

The possibilty of a private owner only allowed to share the cost of fuel/oil with upto 4 POB at say 8 gal/hr oil insignificant. could mean sharing the cost of £60-70. You recieve say £45 your own operating rate could mean you are £60-70 out of pocket. Hire a bigger aicrft from a club at £240/hour you would only pay £60.....................for the flight.

[Johnm]

The Flying Lawyer is a respected Judge and from his earlier career has an honourable reputation for helping pilots in difficulty with the authorities. So insults are wholly inappropriate.

A PPL is forbidden to receive any payment for flying. The cost sharing arrangements are a reasonable exception for truly private flights where a group of up to four people all agree to go on a jolly together and one of them is a pilot and it could be considered unfair if the pilot had to bear the whole cost just because he's the pilot.

It's not significantly different to car sharing arrangements where the driver may be given a contribution to fuel and toll costs without being considered to be driving for hire or reward.

The reaction to the issue of remuneration above shows a misguided interpretation of "remuneration". The word clearly implies a payment for services rendered and is completely different from cost sharing.

[Level Attitude]

read the legislation, what a cop out from a lawyer.

If we could all be as good as you, you would be out of work.

I have read it and it still doesn't answer my previous.
PA28182
Yes it does:
(c) a contribution to the direct costs of the flight otherwise payable by the pilot in command
Much better to have quoted a Reference (without a statement) and let you
look it up yourself, than make a statement (which might be wrong) without
a reference.

The possibilty of a private owner only allowed to share the cost of fuel/oil with upto 4 POB at say 8 gal/hr oil insignificant. could mean sharing the cost of £60-70. You recieve say £45 your own operating rate could mean you are £60-70 out of pocket. Hire a bigger aicrft from a club at £240/hour you would only pay £60.....................for the flight.
The point of cost sharing is not to provide cheaper flying for the pilot.
(Though this might be a consequence)
It is, as Johnm says, to remove the iniquity of several people going on
the same trip but only one person being liable for the cost of the trip
because they 'happened' to be in charge of the aircraft.

[mm_flynn]

read the legislation, what a cop out from a lawyer.

If we could all be as good as you, you would be out of work.

I have read it and it still doesn't answer my previous.

The possibilty of a private owner only allowed to share the cost of fuel/oil with upto 4 POB at say 8 gal/hr oil insignificant. could mean sharing the cost of £60-70. You recieve say £45 your own operating rate could mean you are £60-70 out of pocket. Hire a bigger aicrft from a club at £240/hour you would only pay £60.....................for the flight.
IANAL but can tell you that you are over thinking this one.

Most of the Direct Costs are obvious in the definition provided and obviously include the full cost of renting a spam can (but not of your club membership, checkouts, medical, blah blah blah). And yes, this means that a renter can share a bigger cost than an owner, but as an owner you will be flying a decent turbine aircraft ;). More seriously, as an owner you are already committed to insurance, hangerage, the annual, database updates, etc. - So why should this be shared out to some one just because they went along for a ride. When you rent, you make the commitment for the cost on a day by day or hour by hour basis so it is quite reasonable having made an incremental commitment to go flying with someone that they are allowed to share in this incremental commitment.

'Advertising' that you will take people flying on a cost share basis is not within the spirit of the rules, However, having club fly outs where 4 of you take the plane for a weekend and share the flying/radios and the bills is totally acceptable.

Once again your
If three of the 4 POB are 17yrs 11 mnths then does the P1 pay all of it? comment suggests that you don't read so well. The only age related aspect is that those over 18 who are along on a flying club advertised flight (the only exception to my general 'no adverting comment') must be members of the club - so the 17 and 11 month olds can share the cost but don't have to be members.

Your style suggests you should avoid anything other than the most basic and obviously acceptable sharing (i.e. going on a flight with some friends for a shared purpose in a rental spam can and splitting the rental, fuel, landing costs so you pay at least your share).

[cockney steve]

read the legislation, what a cop out from a lawyer.

If we could all be as good as you, you would be out of work.

PA- you have been a member of this Forum for a considerable time, indeed, long enough to know that if you were as good, in your profession, as FL is in his, You'd be in the top echelon and therefore wouldn't need so much expansion of a fairly small issue.

SEMANTICS... there's a difference between "Remuneration" and "Reimbursement"

As already stated by MM Flynn....Own aircraft, fixed-costs are already committed to, by the owner. therefore fuel, oil, landing and handling fees are the only costs where the owner-pilot must fund HIS OWN FAIR SHARE.

If an aircraft is hired specifically for a group venture then the Pilot's share is again, HIS OWN FAIR SHARE.

If a senile old non-pilot like me can work it out, I have to ask what make of Christmas Cracker your License came out of. :}


PS.. Since F.L. became a Judge, his Position does not allow him to disseminate advice as he did before. Indeed, I think he stopped posting altogether for a while.

[Ebbie 2003]

On the question of direct cost.

If hiring an airplane wet then the situation should not be confusing - direct costs it the total hire plus handing and handling fees. If one buys a chart for the trip I would think it should be excluded.

With airplanes owed by the pilot as a private individual - none of the fixed cost is 'direct' if as seems likely the intention is only to allow what in financial circles is referred to as marginal cost to be recovered.

An interesting question is what happens if the airplane is legally owned by a private company owned by the pilot - if there is a notional cost of $500/hr is that the cost to be shared. I am in this situation - I have not cost shared with non-pilots, but have with another pilot - we share the flying, I fly one leg, he flies the return - we divvy up the cost 50/50 at the break even rate at which we rent the plane to private individuals.

The purpose of cost share rules is not to prohibit legitimate cost sharing but to prevent it bring used as a mask for illegal passenger carrying operations - three friends off for a jolly to the races should not offend the rules - but if one chooses one can read all sorts of nasties into the most innocent arrangement. E.g. a legitimate cost share but one of the pax insists in picking up the lunch bill - is it a reward? It can be seen as such if you are looking to make a point.

The most important point is common purpose - someone flying people around in a four place to destinations where the pilot doesn't want to be in order for him to build hours is not legit with a ppl.

[Heliport]

The most important point is common purpose

'Common purpose' isn't a condition of cost sharing in the UK.


H.

[PA28181]

Dear senile old pilot.

Quote. if you were as good, in your profession, Do you know me.................

How do you have the temerity to question my abilities in my profession.

you are one of those people, who like to join in on the fight but never on your own obviously. You suffer from the obvious "Mock Indignation" that pervades forums like this.

You have that "pack of dogs" red mist mentality that says I will join in and insult someone who has asked a question whether it is stupid or not. As for the other insult my licence is nearly 40 years old and has never been out of currency. And certainly didn't come out of a Christmas Cracker like your post has.

So as a non pilot, please keep your puerile insults to yourself, I know I haven't insulted you. The only person I have obviously upset is the Flying Lawyer who I am sure is well capable of defending himself. In the light of reaction to my post I still stand by my now answered questions about private owners and club hire. And If I have upset the FL then sorry. My banter is as from any bunch of guys I'm with and is just that. As you have not added to my knowledge in anyway with your insulting post. Please do not bother again.
"

[Saab Dastard]

PA28181, please learn to be civil. You seem very fond of dishing it out but unwilling to take it. Banter indeed.

Thread locked to prevent it degenerating into a flame war.

SD