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I want to give my older iPhone to someone else, but they only want to use it as a basic phone, and use data only over WiFi, not over the 3G / LTE network.

However, when their SIM card is put into my phone, the network charges me automatically for a data plan.

How do I show a iPhone as a non-smartphone to the network?

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This is probably dependent on the carrier. Your best best might be to use a prepaid plan. –  Jason Nov 9 '12 at 18:35
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2 Answers

Go to Settings > Date > Mobile Data and change to Off. This will stop you using the 3G / LTE network, while letting you download data over WiFi.

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On my phone (iOS 5.0) go to Settings -> Network -> Cellular Data to restrict everything to wifi.

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It's not about not using the data, it's about being charged even if you do not use the Cellular Data network. What happens is that the network somehow senses that the device being used is an iPhone, and automatically changes the plan to a Data Plan for $25 a month (amount may vary). –  Raj More Nov 13 '12 at 21:16
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