Cost sharing in a group-owned aircraft

Yes, you can share costs in a group-owned aircraft, and the hourly rate you normally pay the group counts as a direct cost that passengers can contribute to. The catch is that the rate you pass on can be no higher than the average market rental price for the same type nearby, and everything the group charges you for ownership (insurance, maintenance, hangarage, subscriptions) stays with you.

Everything else about a cost-shared flight is the same as in any other aircraft: no more than six people including you, no passenger paying more than an equal share, and a signed declaration for each passenger before the flight. This guide covers the parts that are specific to groups.

The group hourly rate is a direct cost

The law limits direct costs to four items: "(a) fuel; (b) oil; (c) airfield charges; and (d) aircraft rental fees at current market rate" (UK Reg (EU) 965/2012 Art. 2(12), and the same words in the ANO 2016 Sch. 1 definition). A group owner doesn't pay a rental fee in the ordinary sense, so the CAA has said how it treats the hourly rate.

GM1 NCO.GEN.102(c) says: "In the case of a jointly owned aircraft, the CAA considers the hourly rate, normally payable by a joint owner, for use of their aircraft to be a 'direct cost'. It may be no more than the average market rental price."

CAP 1590 (guidance), para 30, says the same thing slightly more softly: the hourly rate "should be no more than the average market rental price." The GM's "may be no more than" is the firmer wording, and it is the one to work to.

Two words in that GM matter:

• "normally payable". The figure is the rate you'd normally pay the group for an hour. Read plainly, that rules out a special, higher rate for flights where passengers are paying.
• "average market rental price". This is the ceiling, whatever your group actually charges.

Setting the "rental" figure

The CAA defines market rate as "the average rental price of the same type of aircraft in the same geographic area on the particular date of the flight" (GM1 NCO.GEN.102(c)(b); CAP 1590, para 37). In practice:

1. Start with your group's hourly rate, as set out in the group's rate sheet or agreement.
2. Find the local rental price for the same type. Look at what clubs and schools near your base charge to hire that type around the date of the flight. Our aircraft cost pages give a starting point, but the test is local prices on the date, so check real rates near you.
3. Use the lower of the two. If your group rate is below the market rental price, use the group rate. If it's above, use the market figure in the cost split and cover the difference yourself.

Wet or dry rates

Many groups charge a dry hourly rate and fuel is paid separately; most hire rates are wet. Compare like with like. If your group rate is dry, add the fuel cost to it before comparing it with a wet market rate, or compare it with a dry hire rate if you can find one. Then make sure fuel appears only once in the costs you share. The sources don't spell out how to compare wet and dry rates, so this is the cautious approach rather than a stated rule.

Once you have the hourly figure, add any fuel not already included, oil and airfield charges, and divide by everyone on board including you. The cost sharing calculator does the split and gives any odd pennies to the pilot.

What stays with you

NCO.GEN.102(b) is blunt: "All costs other than direct costs must be paid by the pilot with no contribution from the passengers." ANO 2016 art. 13(2)(b) is worded the same way for non-Part-21 aircraft such as permit types.

CAP 1590 (guidance), para 29, explains that "'Annual costs' are the cost of keeping, maintaining, insuring and operating the aircraft over a period of one calendar year. These costs are required to be paid by the pilot/operator of the aircraft with no contribution from passengers."

For a group member, that means none of these can go into the shared costs:

The CAA has been clear that profit isn't allowed: "There can be no element of profit for the pilot as these flights are not commercial" (CAP 1590, para 28). Loading fixed group costs onto passengers is exactly the sort of thing that could look like profit.

What the group rate already pays for

Group hourly rates often go towards an engine fund or maintenance. The GM treats the hourly rate itself as the direct cost, so passing on your normal hourly rate (up to the market cap) is fine even if part of it ends up funding maintenance. What you can't do is add a separate charge for those items on top. For more detail, see what counts as a direct cost.

Group rules and insurance

CAP 1590 (guidance), para 14, says: "It is the pilot's responsibility to ensure the flight is insured for cost sharing flights with passengers". In a group, the policy is usually arranged by the group, so check with whoever handles it that the policy covers cost-sharing flights with passengers. The CAA template declaration form also asks the pilot to confirm that insurance covers cost sharing.

Check your group agreement too. Some groups have their own rules about passengers or cost sharing, and they apply on top of the law.

The flight must also be "operated by a private individual" (NCO.GEN.102(d)). CAP 1590 explains that this means the pilot "must be acting as a private individual, i.e. not an organisation or company etc." The sources don't specifically address groups whose aircraft is held by a company. As the pilot you're the one operating the flight privately, but if your group is set up through a company, keep the flight arrangement personal between you and your passengers, not through the group.

Records to keep

The legal record is the passenger declaration. NCO.GEN.102(g) and (h) require a record for each passenger, "completed prior to the flight", "retained by the operator of the flight for a period of 6 months from the date of the flight", and produced when an Authorised Person asks for it. See passenger declarations and records for what the record must contain. Split My Flight collects each passenger's signed declaration online before the flight and keeps it with the flight's compliance document.

The law doesn't require you to keep proof of your cost split, but it's sensible to keep:

• the group's hourly rate at the time of the flight
• a note of the local market rental prices you checked for the type, and when you checked them
• the fuel, oil and airfield charges for the flight
• how you divided the total and what each passenger paid

If anyone ever questions whether passengers paid more than their share, those notes show your working.

Before you fly

• Use the group's normal hourly rate, capped at the local market rental price for the type.
• Share only the hourly rate, fuel (if not already included), oil and airfield charges.
• Keep insurance, maintenance, hangarage and subscriptions to yourself.
• Check the group policy and agreement allow cost sharing with passengers.
• Get each passenger's declaration before the flight and keep it for six months.

For the full pre-flight list, see the cost sharing compliance checklist.