Back to posts

# Car Sharing Costs

## Calculating price per trip

Calculate the recommended price per passenger, which corresponds to (fuel + tolls) / 3.
For the sake of simplicity, we recommend a 8p per miles per passenger rate.

Example: A trip from London to Liverpool which costs £48 in fuel would cost £16 per passenger. The driver is already paying for their seat by ensuring that their vehicle is in good working order (insurance, maintenance).

Special cases:

• For short trips (less than 20 miles), we recommend that you charge a flat fee, e.g. one pound per journey.

• If you set up a regular car share, it is often better to establish a monthly fee or, if possible, to arrange to alternate your vehicles so as to balance out costs between you.

Maximum Price :
To prevent excessive prices, such as those sought when airports were closed in April 2010, we have restricted the maximum price per passenger to 1.5 times the recommended price.
Example: the recommended price of £30 per passenger cannot be increased to more than £45. This is an acceptable limit that is justified by the high spec of some vehicles and the fact that some drivers will pick you up and/or drop you off at your door step.

## Calculating annual savings

An average driver does about 13,000 miles per year. According to HMRC guidelines, the real cost of these 13,000 miles would be £0.45 x 13,000 = £5,850 per year. That's £5,850 spent on your car in one way or another (fuel, taxes, repairs, depreciation etc...) and that's clearly a lot.
You can calculate how much you could save annually by: (i) Estimating how many miles per year you could share with car sharing passengers. (ii) Assuming you would get 3 passengers paying our recommended rate of 8p/miles. That's a total rate of 24p per miles. (iii) Multiplying (i) by (ii) will give you an estimate of how much money you can save.

Example: If you need to make 25 roundtrips per year between London and Liverpool (say going back for the WEs or maybe for work) then that's 2 x 25 x 220miles = 11,000 miles every year. Assuming you get 3 passengers to share your journey, you could save 24x 11,000 = £2,640 per year by "renting" your seats to other travelers and significantly offset your annual burn on travels.

## Profit and tax issues

Our recommended price corresponds to a share of the variable fuel costs, whereas the actual price in the eyes of the law corresponds to a tax schedule which includes fixed costs (insurance, maintenance) of about £0.45 per miles.

Example: The real price for a trip from London to Liverpool according to HMRC is 222 miles x £0.45 = £100. However, so as not to make profits, the driver must not receive from their passengers a sum greater than the real price of the trip fixed by the tax schedule. Otherwise they find themselves in a situation where they are being paid to transport passengers and would be obligated to take out specific professional insurance so that their passengers are covered. If the driver from London to Liverpool is carrying 4 passengers, he will receive £80 (4 x £20) and would not be making a profit. More details can be found on the HMRC website

General conditions reminder
We would like to remind you that professional drivers (taxis, coaches) who have professional insurance for transporting paying passengers are not permitted to use this site.

## It's not just about the price

Don't forget the basics when you are travelling with others!

• Punctuality: be on time for the agreed pick-up so that you don't keep other members waiting

• Respect: respond to all the messages that are sent to you

• Responsiveness: warn your fellow car sharers of any change of plan

• Organisation: if you are the driver, fix a specific departure point that is easy to get to

• Care: if you are the driver, respect the highway code

• Foresight: if you are the passenger, have the exact change for your share of the costs on you

Back to posts