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Which Avios-earning small business Mastercard from Capital On Tap is best for you?

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EDIT:  This article is now out of date.  Capital On Tap has relaunched with just one Avios card, Business Rewards, which is better than both of the cards described below.  Click here to read our review of Capital On Tap Business Rewards.  We still have a higher sign-up bonus for our readers!

We have run two articles over the recent months on Capital On Tap, a small-but-growing payments group which is working with Avios to offer two small business Mastercards.  Over 200 Head for Points readers have successfully signed up so far via our special reader offer.

These two cards come with sign-up bonuses of 5,000 Avios or 20,000 Avios respectively as well as an EXCELLENT day-to-day earnings rate.

This is a great way for a sole trader or SME to rack up a large number of Avios each year, especially as HMRC accepts these cards for tax payments with no fee.

Because the two different Capital On Taps cards were launched two months apart, we have never done a proper comparison.  Since a few readers have emailed me to ask which one would best given their spending pattern, I thought I would compare the two cards side-by-side.  Feedback from readers who have applied has been very positive, especially over their quick response to any queries or questions.  

The Capital On Tap cards are aimed at SMEs and sole traders.  Whilst you may not have heard of Capital On Tap, it already has 50,000 customers for its existing ‘no rewards’ payment card.  These Avios cards are their first move into the rewards market.

You can find full details on their website here.  Read this article first, however, as there is a higher sign-up bonus for HFP readers.

Capital On Tap offers two Avios-earning cards for SMEs

The company has launched two Avios products.  One card is aimed at lower spenders and one is aimed at companies or sole traders who are spending larger sums.

I will look at the two cards in detail later but in summary:

Card 1 – ‘Capital Club’

There is a sign-up bonus of 5,000 Avios, with an on-going earnings rate of 0.5 Avios per £1.  The annual fee is £99 (tax deductible).

Card 2 – ‘On Tap Club’

There is a sign-up bonus of 20,000 Avios, with an on-going earnings rate of 1 Avios per £1.  The annual fee is £249 (tax deductible).

Both sign-up bonuses require you to spend £5,000 within three months.

And an extra bonus for Head for Points readers!

Head for Points readers get an extra sign up bonus of 250 Avios with ‘Capital Club’ (total of 5,250 Avios) and 500 Avios with ‘On Tap Club’ (total of 20,500 Avios).

Earn Avios with On Tap Club Mastercard

Interest rate information:  Your interest rate is based on your business profile and can be as low as 9.9% APR.  The standard interest rate for marketing purposes is 39.9% APR.

You can find full details of both cards – and apply – on their website here.  Read on first, however.

Capital on Tap Capital Club Avios card

Who can apply?

The Capital On Tap cards are aimed at sole traders as well as small businesses.  The company appears to be flexible in who they accept:

if you are a UK limited company or limited partnership with turnover of £24,000+ then you should be eligible

if you are a VAT registered sole trader then you should be eligible

if you are a sole trader under the VAT threshold but with more than £24,000 turnover then applications are looked at on a case by case basis – if you have a functioning website and are clearly in business then I am told you should be eligible

Applicants must not have a CCJ against themselves or their business in the past 12 months.

Whilst it doesn’t make any day to day difference in how you use the card, these cards are not credit cards.  They are structured as a prepaid Mastercard which is funded by Capital On Tap.  As far as I can see this doesn’t make any difference to your legal rights, as Section 75 protection does not apply to business credit cards.  In the event of any disputes over purchases, you request a Mastercard chargeback.

How do the two Capital On Tap cards compare?

Here is a summary of the two Capital On Tap products.

Whilst I quoted the earning rates above in terms of Avios, you are actually awarded ‘Capital On Tap points’.  These can be converted into Avios or exchanged for cash.

Confusingly, the transfer rate between Capital On Tap points and Avios points differs between the two cards.

The £99 per year ‘Capital Club’ card offers:

10,000 Capital On Tap points for signing up and spending £5,000 within three months

500 extra bonus points (250 Avios) if you use code headforpoints when applying

1 Capital On Tap point per £1 spent

A 2:1 conversion rate into Avios so the sign-up bonus is worth 5,000 Avios and the on-going earning rate is 0.5 Avios per £1

15 free supplementary cards for your staff

No FX fees and no ATM fees 

The new £249 ‘On Tap Club’ card offers:

20,000 Capital On Tap points for signing up and spending £5,000 within three months

500 extra bonus points (500 Avios) if you use code headforpoints when applying

1 Capital On Tap point per £1 spent

A 1:1 conversion rate into Avios so the sign-up bonus is worth 20,000 Avios and the on-going earning rate is 1 Avios per £1

20 free supplementary cards for your staff

No FX fees and no ATM fees 

Earn Avios with Capital on Tap

Do you really need a dedicated business Mastercard for your company?

Some sole traders, including myself, use a personal credit card for their business expenses.  A lot of self employed people – or their accountants – are not happy doing this, however, and it is clearly not sensible to give personal credit cards to your staff.  You need a dedicated business payment card in these circumstances.

Until now, if you wanted to earn rewards from a small business payment card you were reliant on American Express Gold Business or American Express Platinum Business.  These are good products but obviously have issues over Amex acceptance, especially with small suppliers.

The Capital On Tap Mastercards are small business cards that can be used everywhere that Mastercard is accepted.

Which of the two Capital On Tap cards should I get?

You need to look at the maths based on what you spend, including how much you spend in foreign currencies (the card has no FX fees).

The £99 or £249 annual fee is a tax deductible expense so the net cost to you will be lower.  In Year 1 you are getting a sign-up bonus which converts into 5,000 Avios (£99 card) or 20,000 Avios (£249 card) respectively.

Using the special headforpoints promo code increases your bonus to 5,250 Avios or 20,500 Avios respectively.

Day to day you are collecting 0.5 Avios per £1 spent (£99 card) or 1 Avios per £1 spent (£249 card).  If you and your staff have a high level of business expenditure then this could work out very nicely for you.  Remember that you can have 15-20 free supplementary cards.

For Year 1, I think there is a very strong case for getting the £249 ‘On Tap Club’ card.  The sign-up bonus is worth 20,000 Avios – which offsets most of the after-tax fee – and then you are picking up a lucrative 1 Avios per £1 after that.

For Year 2+, you need to look at what you are spending.  If you value an Avios point at 1p, the crossover point at which the £249 ‘On Tap Club’ card earning 1 Avios per £1 is the best choice is roughly £30,000.  If your annual spend is under £30,000 you may want to trade down to the £99 ‘Capital Club’ card and earn 0.5 Avios per £1.

HMRC accepts Capital On Tap!

Here is one good reason to get a Capital On Tap card.  HMRC accepts Capital On Tap cards to make tax payments with no fees.  This is because HMRC treats it as a personal debit card.  (You need to select ‘personal debit card’ when paying.)

This means that you can earn Avios on all of your PAYE, VAT, corporation tax and indeed personal tax payments.  At 1 Avios per £1 on the ‘On Tap Club’ card this is a valuable extra benefit.

But don’t forget …..

Capital On Tap points can be converted into cashback as well as Avios.  You can choose to take 1p of cash instead of 1 Avios.

If you don’t value Avios at more than 1p (and in most scenarios you can get more than 1p for them as this article shows) then take your Capital On Tap points as cashback instead.

Remember to use our Capital On Tap promo code when you apply!

If the Capital on Tap ‘Capital Club’ or ‘On Tap Club’ cards sound interesting for your business, you can find out more and apply on their website here.

Remember to add promo code headforpoints to receive the extra 500 points as a sign-up bonus.

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.  By recommending credit cards on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

Comments (53)

  • Jase says:

    Has anyone successfully transferred points to Avios? I had my first statement issued and all my On Tap Club Points (approx 30,000 with HMRC payments) vanished. Submitted a support ticket and they said it was an IT issue and the points will be in my account in 3 – 5 business days. The points appeared today but when I go to transfer to BA, I get a generic error this cannot be processed at the moment. Submitted another support ticket but still waiting on a response.

    • Rob says:

      If it continues let me know and I can chase for you.

    • jim cleaver says:

      Yep. same here.

    • Helen says:

      Just got my 3 month 20k bonus and HFP 500 points and transferred to Avios today. It was in my BA Avios account in seconds.

    • Jase says:

      Despite not being contacted by Capital on Tap, I tried again tonight and the transfer worked first go. Better than that, the transfer was instant.

  • John says:

    I took the £249 card and the responsiveness of the customer support team is really good. The problem is that they don’t do much citing company policies…

    The issue that annoyed me the most is the fact that they post all the employee cards to my home address, addressed to the employee… so my wife freaked out when she saw the first card arrived thinking we were defrauded… (I didn’t tell her that she needs to expect a card in the name of an employee).

    The company refused to post the additional cards to the business address citing security concerns…

    The other issue I had was around various bugs with their website which wasted time trying to deal with them. But not a show stopper admittedly.

    Question for the readers: I have a quarterly VAT bill of £200k. I would love to put it on a rewards credit card. However my bookkeepers will freak if I ask them to start splitting it among various cards, recycling credit limits etc. Do any of you can suggest a solution that is easy to manage with such sums?

    • Joseph Heenan says:

      As the account owner has to give a personal guarantee for all spending (including that done by other employees), sending the cards to their address does seem like a sensible security measure.

      I’m not sure if the personal guarantee aspect differs to business amexes. It was a little surprising to have to give a personal guarantee when our company has an excellent credit history.

    • Gbit says:

      I think your going to struggle to pay that sort of vat bill on any card solution (or combination of solutions). Curve and capital on tap limits too low. I have tried to pay 50k vat bill but it’s more trouble than it’s worth. You’d need to pay in a large number of instalments and this could lead to late payment and a consequential ‘default’ penalty which would dwarf any benefit from the points earned. I now pay all vat by direct debit. Much safer, less hassle and a few extra days to pay.

      • John says:

        HMRC allows payments by card of up to £97,000 (I just checked to be sure) so in my case 2 instalments will be needed.

        I thought that perhaps I will be able to top up the card account in advance with the amount I need to pay. This way, instead of transferring the cash to HMRC, i will transfer them to the card company and then use their card to pay HMRC…

        A few years ago i used this technique with Lloyds until they blocked my card for suspicious activity 🙂 and made me go t a branch to activate it again. That was painful so I did not attempt to do the same with other cards…

        I am hopeful COT will be more receptive…

        • Rob says:

          I think you’re confused by HMRC rules.

          When HMRC says it only accepts one card payment, it does NOT mean it has to be one payment. It means you can make unlimited payments, but they must all be on the same credit card.

          I used to pay my bills in chunks of £2,000, since my IHG Mastercard got a bit funny if I tried more than that, and HMRC was happy with many, many, many transactions of £2,000 being put through.

          The reason it doesn’t like multiple cards is that, if you need a refund, it has a problem since it theory it should be split across all the cards you used in the first place.

        • Gbit says:

          That’s might work but I’d be very nervous about have £97k sitting with a fintech startup like Capital on Tap.

  • Alan says:

    Rob, we got this card and it does *not* go through on HMRC, for either PAYE or VAT. It may be that old cards do this but the new ones don’t.

    • Rob says:

      I will speak to them on Monday. The vast majority of readers are not having issues as the comments today show, and there has been no change in the structure of the cards AFAIK.

      • Alan says:

        The card number is being identified by HMRC as a credit card now, so they are trying to charge.

  • Paul says:

    I’ve just completed my first billing cycle for the £249 card. Used it to pay VAT & Corp Tax bills to HMRC with no problems.

    What are others experiences with when the On Tap Club points post? I’ve just received my first bill, but as yet there’s no points showing in the account and I’m wondering if that’s the IT problem referred to elsewhere in these comments, or I’m just being impatient! Also when should I expect the bonus points to post – I’ve already exceeded the £5k target so should they be appearing on this bill too?

    • Mike Bickle says:

      The points appear on the next statement but are not redeemable until after the statement following that one. Golden handcuffs in the card world!

      We spent the target in the first week but we have to wait until 3 months before they appear. Then I guess we’ll have to wait til the statement after that before they will be redeemable.

      We appealed the wait for bonus – was told tough!

  • Billy Nicholson says:

    Great to see examples of you that have paid HMRC with the £249 card as this is the only reason I went for it.
    However for my own sanity, I am confused about the reasons HMRC do accept it without fees. As far as I can tell having just been accepted, I got a healthy credit limit with advertised APRs for cash etc (which I wont use) so it all seems like a standard credit card to me – what am I missing?

    • Rob says:

      It’s complicated and I don’t fully understand it myself. We know that it is a pre-paid debit Mastercard, NOT a credit card. The underlying country of legal issue is somewhere obscure outside the EU, apparently, which I imagine is done for interchange fee reasons.

      I imagine HMRC takes it because it is a debit card, not a credit card, albeit a debit card which is funded by COT – not you – which then asks for you the money.

      Like Curve, I imagine that COT has blocked financial services transactions but does not treat HMRC as a financial services company.

      This is the same situation as the Lufthansa cards, where the Mastercard is a prepaid one, funded by Diners Club at the moment of purchase. You are likely to find Diners adding a cash advance fee if you try using that with HMRC though, which is what happened when I used it to pay another credit card.

      • Billy Nicholson says:

        Ah ok, now I get it. I didn’t quite understand where the ‘prepaid’ part of it came into the equation.
        Thanks Rob

        • Billy Nicholson says:

          Just paid my Corp Tax on HMRC website. Selected ‘Mastercard Debit’ and it went through without any fees or problems. Lovely 🙂