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Bits: a good HMRC miles earning alternative?, Groupon / Avios deal back

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News in brief:

Is this the only alternative to HMRC’s credit card ban?

Earlier in the week I explained how HMRC is banning tax payments on personal credit cards from 13th January (click here).

For those of us who make direct PAYE, VAT, corporation tax or self-assessment payments, this is a blow.  HMRC’s low 0.38% credit card made tax payments a very cheap way of printing miles.

When I wrote that article, I forgot that there was one alternative.  It isn’t hugely lucrative but it may be better than nothing.

You earn 1 Tesco Clubcard point (2.4 Avios or 2.5 Virgin Flying Club miles) for every £8 you spend on the Tesco Bank debit card.  You obviously need to take out a Tesco Bank current account to do this.

Tesco Bank doesn’t let you earn debit card points on financial transactions, but luckily HMRC is not treated as ‘financial’.

Whilst this clearly isn’t as lucrative as using the best Visa or MasterCard credit cards to pay your tax, remember that using debit cards is free with HMRC.  3,000 Avios for paying a £10,000 tax bill isn’t hugely generous but arguably better than nothing.

Full details of the Tesco Bank current account are here.

Groupon / Iberia deal is back – buy Avios for 1p

Iberia has brought back its occasional Groupon offer which allows you to buy Avios points at a discount to the official price, usually around 1.1p each.

I have written about the pros and cons of these offers in the past.  Our last full article on this deal is here.  The pricing is the same as it was then.

The cheapest and best value package of 2,000 Avios has sold out.  The other packages work out at over 1.00p per Avios and are therefore not a bargain, but potentially worth it as a top up.

The Groupon site – in Spanish – is here if you want to take a look but it makes more sense to go via Iberia’s shopping portal here to earn an extra 9 per €1 spent.  If it tracks – and you can’t control that – then the deal starts to look more attractive.

How to earn Avios from UK credit cards

How to earn Avios from UK credit cards (April 2024)

As a reminder, there are various ways of earning Avios points from UK credit cards.  Many cards also have generous sign-up bonuses!

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

Barclaycard Avios Plus card

Barclaycard Avios Plus Mastercard

Get 25,000 Avios for signing up and an upgrade voucher at £10,000 Read our full review

Barclaycard Avios card

Barclaycard Avios Mastercard

5,000 Avios for signing up and an upgrade voucher at £20,000 Read our full review

There are two official British Airways American Express cards with attractive sign-up bonuses:

British Airways American Express Premium Plus

25,000 Avios and the famous annual 2-4-1 voucher Read our full review

British Airways American Express

5,000 Avios for signing up and an Economy 2-4-1 voucher for spending £15,000 Read our full review

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points. These points convert at 1:1 into Avios.

American Express Preferred Rewards Gold

Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review

The Platinum Card from American Express

40,000 bonus points and a huge range of valuable benefits – for a fee Read our full review

Run your own business?

We recommend Capital on Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios.

SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.

Capital on Tap Business Rewards Visa

Huge 30,000 points bonus until 12th May 2024 Read our full review

You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus.

British Airways Accelerating Business American Express

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review

There are also generous bonuses on the two American Express Business cards, with the points converting at 1:1 into Avios. These cards are open to sole traders as well as limited companies.

American Express Business Platinum

40,000 points sign-up bonus and an annual £200 Amex Travel credit Read our full review

American Express Business Gold

20,000 points sign-up bonus and FREE for a year Read our full review

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.

Category

British Airways and Avios, Iberia and Iberia Plus, Tesco Clubcard, Virgin Atlantic and Flying Club

Comments (105)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Roger says:
    13 Oct13 October 04:54

    OT_ Amex Referrals

    If you manage to find working link of Amex Referrals which allows you to select other cards i.e. MR card allows to select BA, SPG etc., would it work for self referral, i.e. can I apply using my own link in different card currency but still get bonus?

    Anybody manage to get such bonus either for self or for OH/Family?

    • VP says:
      13 Oct13 October 06:47

      Haven’t done this for different currency card but I have self referred myself for Gold when I wanted to cancel my platinum and I got the referral points and free Gold for 1 year. I did not spend on the card to see if I would get signup bonus by mistake as my aim was just to preserve my MR points and refer my wife when her 6 months are up. Referring OH or family is absolutely fine.

    • JP says:
      13 Oct13 October 09:27

      You wouldn’t be able to get the bonus if you have nowhere for it to go as is a different currency. You will probably get the the extra points on the new card but you might as well use Rob’s or someone else’s referral then.

  • kt1974 says:
    13 Oct13 October 06:30

    The only consideration for many people who have the Tesco current account is that most keep their balance under 3k to get 3% interest. Otherwise you get nothing. And while I would love my HMRC bill to be under £3k…

    • John says:
      13 Oct13 October 06:35

      ?? what does the ongoing balance have to do with your tax bill? And why would you keep the balance *under* 3k? My Tesco account always has exactly £3000 in it except when I need to make a debit card payment, whereupon I immediately transfer in the amount required.

      • kt1974 says:
        13 Oct13 October 07:02

        #pedantic
        So do you transfer out earned interest the second that it hits your account?
        I’d argue that’s a faff, and I have better things to do with my life, but YMMV

        • Mr dee says:
          13 Oct13 October 07:13

          You get interest p the balance up to 3k whether you have more or not. You can keep the interest in the account making it over 3k but only the balance over 3k won’t earn 3%

        • the real harry1 says:
          13 Oct13 October 09:40

          yep Mr Dee is right, it’s not as if when you go to £3001 they stop paying interest on the first £3000

          say you have to pay a £10,000 tax bill so for a week you absent-mindedly have £13,000 in the a/c

          you still earn 3% interest on £3000

          and as 1% seems to be the norm these days for savings interest, you have lost about £1.92 by dumping the £10,000 in the Tesco a/c

        • John says:
          13 Oct13 October 09:49

          Ok, “immediately” was an exaggeration but I usually transfer the interest out the next time I log in, which is sometimes immediately and sometimes not for a month since I rarely need to make debit card payments.

          In any case it doesn’t matter, I just won’t be earning interest on the interest before I move it out, and now you can do this too since you had a rather big misunderstanding about how the account works.

        • Crafty says:
          13 Oct13 October 18:59

          Standing order…

    • RichS says:
      13 Oct13 October 06:58

      I think you’ve misunderstood, it’s 3% on the balance up to £3000, 0% on any additional balance (eg if you have £4000 in the account, you will get 3% on 3000).

      • kt1974 says:
        13 Oct13 October 07:04

        I don’t think that’s clear from the terms and conditions. It just says 0% if your balance is over 3k. Can anyone verify that you get 3% for first 3k?

        • Mr dee says:
          13 Oct13 October 07:15

          It’s 3% on the first 3k regardless of balance.

        • Andy says:
          13 Oct13 October 10:19

          “To earn 3% AER credit interest on balances up to £3,000 until 1 April 2019, simply pay in at least £750 and pay at least three Direct Debits each statement month (excluding Direct Debits to Tesco Bank savings accounts)”
          Unless of course you have had this account for some time, then you are grandfathered in at not having to do anything. No minimum pay in and no DD’s needed

    • James Baring says:
      13 Oct13 October 13:28

      I have a Barclays Premier account. The overdraft used to be 0% for the first £1000, then 14.9% for every £1 above £1,000 until Barclays changed their system. Now, if I’m less than £1000 overdrawn – no daily fee. But if my account is £1000+, I get whacked a daily fee. Not a problem now. But I was charged the best part of £90 one month. Banks are pretty much all evil. And I should know. I’m a banker. Only one thing worse than a bank: and that’s Tesco. Tesco Bank? Is 3000 Avios points really worth the hassle? Why not just collect 3000 Heathrow Points for buying £150 of perfume or booze. At least you’ll enjoy it. Or smell nice.

  • Chris says:
    13 Oct13 October 06:45

    Here is a way to gain points for your tax bill:
    1. Spend the necessary amount on a cancellable car hire or hotel accommodation up to the value of your tax bill. Ensure that the website takes the money from your card and that they offer free cancellation insurance.
    2. Receive the points and spend them
    3. Cancel your booking but explain that you no longer have the card you booked with. The money will now have to be transferred to another account.
    4. Now use the cash to pay your bill.

    • Mr dee says:
      13 Oct13 October 07:10

      That has nothing to do with the tax bill

      • Chris says:
        13 Oct13 October 07:13

        If does if you pay the tax bill with the cash that you now have.

        • Mr dee says:
          13 Oct13 October 07:23

          No that’s just a way to try and possibly get a cash refund, what you use the cash for is up to you but has nothing to do with a tax bill.

          If I was to buy a laptop and say I don’t have the card anymore and get a cash refund, I might as well keep the cash and put it into a savings account rather than pay the tax.

          It is also to be honest is a very poor way as many companies will refund your card and tell you to get the money from your credit card issuer especially for large amounts.

          Good luck though but can’t see it working above a couple of hundred pound of your lucky.

        • Anna says:
          13 Oct13 October 09:07

          Whenever I’ve returned an item to a shop (not often, I can rarely be bothered unless it’s faulty!), I’ve had to put a card in the machine and enter the pin, so how could they refund the money to a card you didn’t physically have with you? Online, I agree it’s a pain, it took me months once to cancel an Amex card because there was an 80p credit on it!

        • John says:
          13 Oct13 October 09:55

          It’s much easier to just buy clothes on the high street and refund them. Once in a while you get a cashier who forgets to ask to see the card you paid with, then you put a debit card in and keep the points.

    • Polly says:
      13 Oct13 October 10:55

      Chris..that’s very smart…best use a card you are close to cancelling tho…but yes this can be used for reaching a bonus spend too…

    • RussellH says:
      13 Oct13 October 11:08

      A trader’s contract with their merchant aquirer requires them to make all refunds back to the card account used for the payment, whether or not the card is still active. I never needed a physical card in a terminal to make a refund – I just keyed the card number in.

      • the_real_a says:
        13 Oct13 October 12:40

        … but large retailers really do not care. And often if you replace/lose your CC it will come with a new number. I do hope you are not storing full CC numbers in your business somehow.

      • Mr dee says:
        13 Oct13 October 14:09

        Have had companies just refund my Amex card even though I cancelled it months before and then I have to get Amex to refund me what a pain.

        • Mr dee says:
          13 Oct13 October 14:11

          It is usually online companies rather than offline however.

        • Chris says:
          13 Oct13 October 21:24

          I have done large amounts with a hotels website and a car hire one. Where free cancellation insurance is offered or is offered for a small fee they do not care which card it is paid back too. So if you need to pay a £10,000 tax bill for example:
          Book a hotel, get points, use points, cancel card, request cash refund then use cash to pay tax bill. It works very well if you want to reach an annual bonus for points.

  • Andrew M says:
    13 Oct13 October 06:54

    OT Does anyone know when the 40,000 bonus points for spending £12,000 on the HSBC World Elite card in the first year should post? I have met the spending target and my most recent statement included the £195 fee for next year – but no sign of the bonus points yet.

    • Rob says:
      13 Oct13 October 07:09

      Off top of my head I think points will take up to 60 days to post. My 12 month anniversary comes up in 2 weeks time.

      I’m holding out hope for another 1.5x bonus to avios but seems as if the deal last year was perhaps a one-off.

      • Andrew M says:
        13 Oct13 October 07:35

        I was hoping for a x1.5 Avios bonus as well. It ran from 01/10 to 30/11 last year but it doesn’t seem to be on now. I did a dummy transfer recently, without completing it, and no bonus was shown.

      • New Card says:
        13 Oct13 October 10:55

        Raffles seemed pretty confident that there wouldn’t be a bonus this year, sadly…

    • New Card says:
      13 Oct13 October 08:14

      The terms and conditions say 60 days after hitting the £12k spend threshold.

      No particular need to incur next year’s card fee to get this bonus…

      • Andrew M says:
        13 Oct13 October 08:27

        I get the fee instantly refunded anyway so it doesn’t worry me!

        • Polly says:
          13 Oct13 October 10:51

          Hi Andrew
          How do you get your fee refunded.. is that because you are waiting for bonus points to post ? And you have rolled into the 2nd year?
          We too are waiting for a ba bonus transfer. Great boost last year…

      • rob says:
        13 Oct13 October 08:33

        They don’t follow their own T’s and C’s (!) as although we should get the 40k after spending the £12k they generally only post 60 days after the 1st anniversary; checked this also with HSBC themselves.

        I was going to complain but I don’t mind as I won’t spend on the card in the 2nd year and get a fee refund along with the 40k miles (20k avios).

        • New Card says:
          13 Oct13 October 10:23

          Thanks that’s helpful to know – my 60 days are up in a few weeks time (but still 9 months to go til year 2) so I probably will put in a complaint…

  • Jonathan says:
    13 Oct13 October 07:10

    Hi All, quick question on the gold to plat upgrade.
    I’m off to HK in December so thinking of getting the plat upgrade to use the Centurion lounge at HK. Does the priority pass process quickly? I want to avoid being in limbo between both gold and plat cards without lounge access. I have the Gold lounge club passes if the pp process is slow, but don’t know if they are cancelled upon no longer holding the Gold card (even if upgrading).

    Thanks

    • Genghis says:
      13 Oct13 October 07:57

      Often arrives before the Plat card itself, within c.4 days.

      • Stu N says:
        13 Oct13 October 08:02

        Centurion lounge access is gained by showing your Platinum card and is entirely separate from Priority Pass scheme.

        The Priority Pass cards arrive pretty much immediately, <1 week from application. I got mine before Amex had confirmed I had been accepted…

    • Scottydogg says:
      13 Oct13 October 13:51

      I done the upgarde and Amex forgot to bill me for the £450 Fee
      Kept it for 3 months then cancelled it
      Hope you get the same deal 🙂

    • Peter K says:
      13 Oct13 October 18:18

      I did the upgrade route earlier this week (or maybe Sunday?) and got the Platinum card in the post today. Not the PP yet however.

    • Relaxo says:
      14 Oct14 October 05:42

      Just been to the HK lounge this week. Quite disappointing to be honest. Only got capacity for about 75 people so might get full once more people find out about it. Need to take the train over from main Terminal 1 which is inconvient if your flight boards from gates 1-29. Food was average. Main + is free cocktails….sounds great on paper but bartenders are inexperienced….

  • James says:
    13 Oct13 October 08:02

    A ‘deep dive’?

    Rob – have you been hanging out with Americans lately?

    Will circle back to you later on this so we can take a laser focused look.

    • Trinovant says:
      13 Oct13 October 08:24

      Which is the easiest card review to do, where’s the low hanging fruit?

      A deep dive isn’t a bad idea, rub it up the flag pole and see who salutes.

    • Rob says:
      13 Oct13 October 08:36

      Occasionally the old banking language creeps back in!

  • Rob says:
    13 Oct13 October 09:43

    Yes, I was told this was coming. The MBNA end is nigh …..

    • Wally1976 says:
      13 Oct13 October 10:03

      Pretty sure this only stopped working yesterday as I’m sure I tried it first thing and it worked. Might still get his ‘n’ hers white cards ASAP for 3k points each especially as only one transaction required – nothing to lose (except for hit on credit record). That’s if the applications are still there….trots off to check…

      • Wally1976 says:
        13 Oct13 October 10:04

        Yes it appears you can still apply for these cards (for now at least).

      • Wally1976 says:
        13 Oct13 October 13:24

        Just tried and we both failed the eligibility check! Can only think it’s because we only cancelled these cards in June and September respectively.

    • Jonathan says:
      13 Oct13 October 11:59

      Would someone with a black card, and renews at the end of this month (October) be worth renewing and see what JanFeb brings when it is due to be chopped?

      Secondly, still got 6-8 months on my wife’s black card. Since we got the sign up points, is it worth keeping and see what next year brings or chop it and churn?

      • Rob says:
        13 Oct13 October 12:32

        I’d keep it, worst case is that is closes overnight and they pro-rata a fee refund.

      • TripRep says:
        13 Oct13 October 12:44

        Depends if you value the sunk cost of £140 with no corresponding sign up bonus, the PE upgrades are good tho if you can find availability.

        My Virgin Black Amex card anniversary date is next month, I intend to cancel, IMHO not worth it for another year without the bonus. Besides, I may consider a BAPP once again, but a bit of a pity you can’t refer it from an Amex PRGC.

      • the_real_a says:
        13 Oct13 October 13:12

        Also if you can hit the spend threshold for the premium economy upgrade vouchers in a couple of months, you will get them for practically no annual fee, and i guess will post to Virgin at the point the card is closed down.

        • Alan says:
          15 Oct15 October 16:04

          No pro-rata fee refunds with MBNA though, so it doesn’t make a difference when you trigger the spend?

  • Anna says:
    13 Oct13 October 10:02

    Is anyone familiar with CE flights to Madrid? I have a Lloyds upgrade voucher but am only going to be able to fit in a short-haul trip before it expires. I’m quite tempted by Madrid as a couple of the daily flights are on 777s, so have flat beds in CE. If you book one of these, is the aircraft type guaranteed?

    • Rob says:
      13 Oct13 October 10:08

      Yes, because these are primarily cargo flights. BA cannot just swap the plane over. Iberia runs A330 / A340 aircraft between Madrid and Heathrow (as I reviewed the other day) for the same reason.

      • Anna says:
        13 Oct13 October 12:11

        That’s good to know, I feel my upgrade would be much more valuable in a proper business cabin!

    • Mr dee says:
      13 Oct13 October 14:21

      Yes did this recently on the voucher as well, there is the Iberia a340 option and the ba 777 option. Tip buy on board will be better than the afternoon tea option.

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