Bits: HMRC to stop accepting prepaid cards, get 25% off selected Etihad redemptions

News in brief:

HMRC to change the rules on accepting credit and debit cards

When pay.com cards were still available, using them to pay any HMRC liabilities was smart.  They were treated as a debit card, so you saved the 1.4% HMRC fee, but you could buy them with a credit card.  If you bought them in Tesco, you also picked up a lot of Clubcard points.

The ‘fee paid’ Visa gift cards which you can buy in some Tesco stores can still be used for this purpose.  If you have some Tesco ‘conditional spend’ coupons – I was sent £9 off a £60 spend recently – it is worth buying them, especially as every £50 purchase earns you 150 Clubcard points.

From January 1st, the rules will change.

To quote from the HMRC website:

“From 1 January 2016, HMRC will limit the number of times you can use a credit or debit card within a certain time to pay your tax. The rules apply to multiple card payments against the same tax – you can only make extra card payments if each one’s for a different tax, eg Corporation Tax and employers’ PAYE. If you’re unable to pay your VAT bill in full by card, you should use another payment method like a bank transfer.”

The only logical reason to do this would be stop the use of prepaid Visa and Mastercard products.

You should note that the credit card fee has also increased to 1.5%.  This seems ludicrous given that the new EU rules capping interchange fees at 0.3% come into effect next year.

25% off selected Etihad redemptions

Etihad Guest is offering 25% off some redemptions if you book before 25th November.  The snag is that the travel window is ludicrously tight – you need to fly out by the end of November and return by 10th December.

You can see the routes which are covered here.  Dublin and London are reduced for Economy redemptions whilst Manchester is reduced for First Class redemptions.  If you are travelling beyond Abu Dhabi, you would also need to see if your eventual destination was included.

The small print contains a couple of nasty surprises.  It claims that these redemptions would be non-refundable (although less of a worry given the short travel window) and that you cannot combine it with the generous Etihad ‘cash and miles’ payment option.

I find the whole promotion a bit odd, to be honest, as a 25% discount (to a very limited list of destinations) is not enough to encourage you to literally drop everything and fly.  If you have a redemption already booked, however, it may be worth changing it.

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How to earn Etihad Guest miles from UK credit cards (April 2024)

Etihad Guest does not have a UK credit card.  However, you can earn Etihad Guest miles by converting Membership Rewards points earned from selected UK American Express cards.

Cards earning Membership Rewards points include:

• American Express Preferred Rewards Gold (review here, apply here) – sign-up bonus of 20,000 Membership Rewards points converts into 20,000 Etihad Guest miles. This card is FREE for your first year and also comes with four free airport lounge passes.

• The Platinum Card from American Express (review here, apply here) – sign-up bonus of 40,000 Membership Rewards points converts into 40,000 Etihad Guest miles.

• American Express Rewards credit card (review here, apply here) – sign-up bonus of 10,000 Membership Rewards points converts into 10,000 Etihad Guest miles. This card is FREE for life.

Membership Rewards points convert at 1:1 into Etihad Guest miles which is an attractive rate.  The cards above all earn 1 Membership Rewards point per £1 spent on your card, which converts to 1 Etihad Guest mile. The Gold card earns double points (2 per £1) on all flights you charge to it.