Once you decide to rent out your car through a car sharing platform, it’s time to begin the sign-up process. Luckily, getting started is easy and straightforward, especially compared to building your own private fleet business. Even so, it’s smart to go in prepared with all the information you’ll need — such as details about your car and the bank account you want to deposit your earnings into — so that you can create your profile and list your car in one sitting. Let’s dive into how to rent out your car on a car sharing platform and what you can expect at each step along the way.
5 steps to renting your car out
The following step-by-step guide can help simplify the process no matter which platform you choose. While individual steps vary by platform, most car sharing companies operate under similar guidelines and make it easy to see how car sharing works.
1. Choose a car sharing platform
Selecting the peer-to-peer (P2P) car sharing platform that most closely aligns with your goals is the most important step in sharing your car. Whether you plan on using Avail for its passive sharing offering and guaranteed payouts or Turo or Getaround so you can interact with borrowers and set your own rate, the first step is to create a profile on the platform’s website and download its app. Before you do, check for sign-up bonus offers. If there is a particular way to register or a promo code to include, you don’t want to miss that step.
You’ll need to provide some basic personal information, such as your name, address and phone number, as well as banking information for the account you want to transfer your earnings to.
2. Confirm your car’s eligibility
All car sharing platforms have eligibility requirements. This helps the companies ensure they are offering drivers vehicles that meet the latest safety and emission standards and will be covered under their car sharing insurance policy. While the individual guidelines vary by company, peer-to-peer car sharing platforms usually want vehicles that:
- Are no more than 10 years old
- Have fewer than 125,000 miles
- Are free of physical damage or mechanical defects
- Do not have salvage titles
- Have an automatic transmission
- Have a gasoline or hybrid gas-electric engine
Closely read the guidelines for your chosen car sharing platform to ensure your vehicle meets the requirements. Once you confirm you’re eligible, you can add your car’s information to your profile for verification. You’ll likely have to submit your car’s vehicle identification number (VIN) or license plate number, followed by details such as its make, model, color and mileage. Some car sharing platforms will require photos of your car as part of this step, while others might ask for this in the listing creation stage.
3. List your car to be shared
With your profile, payment and vehicle information complete, it’s time to list your car for sharing. The process for each platform differs somewhat but generally involves providing other essential details about your vehicle.
Avail, for example, asks you to select your city, the specific location where you’d like to drop off your car and your listing dates (5 consecutive days is the minimum). After Avail runs internal checks and approvals, you’ll be able to finalize your listing. Prior to the start of your listing, you’ll park your car at the Avail location you chose and drop the keys in a secure on-site key box. From there, Avail will photograph and document the condition of your car as part of the inbound inspection process.
Turo’s process has a different flow. You’ll add your car’s VIN first, upload a profile photo and provide personal details, like your mobile phone number and driver’s license information. Next, you’ll define your goals for using the platform. Turo will ask for your availability and for you to upload images of the vehicle and provide safety and quality details, such as the condition and a description of your car. Finally, you’ll enter banking information. Once you submit your listing, you’ll receive a notification upon approval.
Getaround’s process is similar, requiring you to create a personal profile and then add vehicle information as well as photos. After you complete this step, you then have to wait for them to contact you to schedule a time to install their proprietary hardware. This electronic device allows your vehicle’s borrower to unlock the car without your participation and tracks the vehicle’s usage during the reservation period.
4. Coordinate vehicle drop-off
Each car sharing platform coordinates vehicle drop-off differently. Avail relies on dedicated parking spaces in lots and garages throughout the cities in which it operates. Each lot is equipped for self-service, so you just park your car and drop the keys in a secure on-site key box. This eliminates the need for any contact or coordination between owners and borrowers.
Turo puts the onus on owners and borrowers to coordinate hand-offs themselves. You can arrange to meet in-person, but the company also allows owners to make the experience contactless, either through using Turo Go, a lockbox or the manufacturer’s remote unlocking technology. There are no dedicated parking spots like Avail offers, so owners may need to bear that cost while their vehicle is listed but not booked.
Getaround relies on its Getaround Connect app to facilitate the car exchange. Owners will park their car within a quarter mile of a designated “home” location and enable remote access. Borrowers use the app to enter the car and retrieve the keys. You can rent a dedicated parking space from Getaround for an additional fee, but it’s not a requirement. Borrowers also have to return the vehicle to a parking space within a quarter mile of the home location if the owner isn’t paying for a spot from Getaround.
5. Prepare for taxes
After you list your vehicle, you’ll also need to track specific information for tax purposes. Any income that exceeds $600 requires reporting to the IRS. To help with this, your car sharing platform might send you a 1099 form that outlines your exact earnings for the year. Even if you don’t receive one, you’ll still need to account for that income.
Keep records of your payouts from your car sharing platform and check the total against the 1099 form that you receive to ensure it’s accurate. You’ll also want to keep track of your car’s mileage from each sharing period, as business mileage can sometimes be a deductible expense. Other deductible expenses can include:
- Parking fees
- Repairs and maintenance
- Car washes
- Car sharing service fees
Finally, don’t forget to track the cost of your car insurance, especially if your insurance provider requests that you purchase a commercial policy for your vehicle.
Since you’ll be renting your car out as a side hustle, you may need to account for quarterly self-employment estimated taxes. The self-employment tax rate is 15.3%, which covers 12.4% for Social Security and 2.9% for Medicare. These payments can be mailed in or completed online. It’s recommended to work with a tax professional to determine how much you owe at each quarterly deadline, as they’ll take into account your other sources of income and provide the right amount that you should pay to avoid penalties.
Make car sharing a success
The first two steps we covered above — choosing a car sharing platform and confirming your vehicle’s eligibility — only have to be done once (unless you decide you want to change platforms). But the other three steps — listing your car, dropping it off and keeping track of deductible expenses — are ongoing for as long as you continue to share your vehicle.
To ensure both you and the drivers who book your car have a good experience, there are a few more steps we recommend taking before dropping off your car. First, remove personal items and those that add clutter to the car. If you want to keep an emergency kit or ice scraper, then that is perfectly fine. However, you also need to be ok with the possibility that those items may disappear by the time the vehicle is back in your possession.
Next, take photos of the outside and inside of your car, even if the platform you use doesn’t require it. If you’re the first to notice a new scratch, dent or fabric tear and want to request compensation for repairs, then the “before” pictures with a date stamp are essential for making your case. Finally, clean the car inside and out and fill up your gas tank to ensure the next person who borrows your car starts their trip feeling good about their decision to book your vehicle.
Frequently asked questions about renting your car out
How much money can you actually make renting out your car?
How much money you make renting out your car largely depends on several factors, including your location, type of vehicle, the service you use and how often people book it. Avail guarantees at least $50 per week or $200 a month as baseline earnings. You can make well over that if your car gets booked more often than not. Turo offers tiered payouts that increase as you take on a higher deductible and more risk. Getaround has a flat commission of 40% and allows you to set your own price per trip or use its predictive pricing tool in some cities.
How do you determine the rental price for your car?
For many users, the rental price is determined by the company. For example, Avail owners earn $20 per day for sedans and mid-size SUVs and $25 for larger vehicles. Turo determines the minimum and maximum price based on a listed car’s value, although it does have an option for custom pricing and discounts. Getaround allows car owners to set a rate, and it offers a predictive pricing algorithm that can be used in some markets.
How do I determine if my location is suitable for renting out a car?
To determine if you can rent your car out, consider whether it’s even legal for you to do so. Each state has specific rules surrounding car sharing. Maryland, for example, does not allow you to share any vehicle with a model year older than 10 years. You also can’t share a vehicle that has any open recalls.
You might also want to look at area demand. High tourist activity or populated urban areas often make for ideal rental conditions. Consider whether your car makes sense as a regular rental. SUVs and sedans are popular options. Mini-vans? Not so much. Finally, ensure the car sharing platform you want to use currently operates in your city or accepts out-of-area vehicles, like Avail.