I was recently asked the question “if my aircraft consumes up to 12 gallons per hour and I charge my passenger accordingly, yet in reality the aircraft only consumed 8 gallons per hour on a cost-sharing flight, then am I legally making a profit on that flight?” My answer was “no, technically, this would not be legal.”
FAR 61.113 talks about “pro-rata” sharing of expenses, meaning the total operational expenses must be divided amongst the pilot and passenger(s) with the pilot paying his or her percentage. As a practical matter, under the proposed scenario it may be difficult, although not impossible, for the FAA to determine whether 8 or 12 gallons of fuel was actually burned. However, if the pilot was ever asked by the FAA, he would need to document how he arrived at the total operational expenses and how the pro-rata calculation was made. Whether this proof is in the form of fuel or other receipts, or simply reference to the aircraft POH, will depend upon the circumstances.
The bottom line is that FAR 61.113 grants an exemption for legitimate sharing of expenses. If a pilot is making a profit on a flight and the FAA discovers that fact, the FAA will likely take the position that the pilot is receiving compensation in violation of the FAR.