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British Airways cuts Avios flight taxes to £1 in the UK and Europe – but it isn’t as good as it sounds

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It’s back.  Following a short trial in April, British Airways is rolling out ‘£1 taxes’ Avios redemptions on ALL UK and European routes for a trial period.

Instead of paying £35 (Euro Traveller) or £50 (Club Europe) in taxes and charges on return short haul flights, you can now choose to use more Avios and reduce your taxes and charges to just £1.

Be wary, however.  This is not necessarily a great deal.

Avios wing 9

Take a look at the screenshot below as an example.  It shows a return Avios redemption on British Airways in Euro Traveller (economy) from London Heathrow to Nice.

If you look at our full list of Avios redemption pricing by route (click here), this would normally price at 8,000 Avios + £35 for a Reward Flight Saver reward redemption on an off-peak date.

Instead, you get (click to enlarge):

New British Airways Avios pricing

The ‘headline’ price is shown as 15,000 Avios + £1 in taxes and charges.

When you click through to the payment page, you are given this list of options:

£1 British Airways Avios pricing

The ‘old’ option of 8,000 Avios + £35 is not there.  It has actually got cheaper – you are now offered 8,000 Avios + £31.

It isn’t easy, at first glance, to see which option is the ‘best’ value, assuming you have a lot of Avios and a lot of cash.  However, doing the maths:

15,000 Avios + £1 = base offer

11,500 Avios + £21 = £20 spent to save 3,500 Avios = ‘buying’ Avios at 0.57p

8,000 Avios + £31 = £30 spent to save 7,000 Avios = ‘buying’ Avios at 0.43p

5,900 Avios + £61 = £60 spent to save 9,100 Avios = ‘buying’ Avios at 0.66p

5,000 Avios + £71 = £70 spent to save 10,000 Avios = ‘buying’ Avios at 0.7p

4,400 Avios + £81 = £80 spent to save 10,600 Avios = ‘buying’ Avios at 0.75p

As long as you value an Avios point at 0.43p or higher – and all HfP readers should value them far higher than this – you should NOT take the £1 offer.

The only question in your mind should be which of the other scenarios is best for you – all of them are basically letting you ‘buy’ Avios VERY cheaply by using more cash. The only issue is whether you buy a few for a very low price (8,000 Avios + £31 is the best ‘price per point’ spot) or buy a lot for a higher price (4,400 Avios + £81).  Taking the £1 offer is a bad deal.

British Airways reduces Avios taxes to £1

It happens in Club Europe too

If you try to book a Club Europe return flight to Venice, you get these options on a peak day.

This flight SHOULD cost 30,000 Avios + £50 return.  The new headline offer is:

British Airways £1 Avios pricing

…. with the following alternatives:

British Airways £1 Avios pricing

If we do the maths again:

40,000 Avios + £1 = base offer

35,600 Avios + £25 = £24 spent to save 4,400 Avios = ‘buying’ Avios at 0.55p

30,000 Avios + £50 = £49 spent to save 10,000 Avios = ‘buying’ Avios at 0.49p

22,000 Avios + £121 = £120 spent to save 18,000 Avios = ‘buying’ Avios at 0.67p

20,000 Avios + £141 = £140 spent to save 20,000 Avios = ‘buying’ Avios at 0.7p

16,000 Avios + £161 = £160 spent to save 24,000 Avios = ‘buying’ Avios at 0.67p

You get the same result as in the Economy example.  The £1 deal is the worst deal.  As long as you believe you can get more than 0.49p per point on another redemption, it makes sense to pay more cash and use fewer Avios.

Another factor …. cancellation costs

I have just said, twice actually, that the £1 deal is the worst deal.

Except ….

If you believe that there is high chance of cancelling a ticket, the £1 route is possibly the best one.  When you cancel an Avios redemption, the cancellation fee is the lower of £35 per ticket OR the taxes paid.  If you only paid £1 in taxes, your cancellation fee is only £1.

For a family of four, you are getting your potential cancellation cost down from £140 to £4 by taking the least cash route.

Is offering ‘£1 taxes’ a good thing or not?

On the face of it, it is fine.  It gives people more options and that is generally a good thing.

I don’t recommend taking the £1 deal if you earned your points from credit card spending, Tesco Clubcard conversions, Heathrow Rewards conversions etc.  You are getting a poor return compared to taking one of the other deals.

Of course, you may be happy with this new offer if all of your points came from flying or you are ‘Avios rich, cash poor’.

I’m sure that more quirks in the pricing will come clear in the next few days.  And, of course, this is officially still a trial.

PS.  You need to qualify for Reward Flight Saver to get the £1 deal.  We explain Reward Flight Saver here.  This means that your British Airways Executive Account needs to have earned 1 Avios over the past 12 months.  If you have not done this – unlikely for a HfP reader – you will be shown the full taxes when you try to book.

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Category

British Airways and Avios

Comments (142)

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

  • LewisB says:
    16 Jul16 July 12:51

    Do you recon this will eventually be tested for long haul, Rob?

    • Rob says:
      16 Jul16 July 12:59

      Potentially, but it will be an even worse deal. Would you rather pay 100k + £500 to New York or 200k + £1? Note that 2-4-1 redemptions seem to use the original pricing.

      • LewisB says:
        16 Jul16 July 13:22

        Personally no. But I could imagine the ‘lay’ person being tempted to pay just £1 for long haul travel. It would make economy look more attractive for those who have no aspirations to fly J or F.

        • Rob says:
          16 Jul16 July 13:23

          As can I. And then the other options get hiked up in price.

          On the other hand, when you see ‘15000 Avios + £1′ to get to blinkin’ Nice, I doubt many people are rushing out to get a BA Amex earning them 1 Avios per £1. This tactic could backfire ….

          • BJ says:
            16 Jul16 July 17:29

            Going forward there are going to be few ‘lay’ persons with 200k avios to spend given the increased difficulty in collecting.

      • Charlieface says:
        16 Jul16 July 14:23

        Am I not right that the Avios + Money options are a lot better under this offer than they were? I seem to remember over 1p/Avios

      • Lady London says:
        16 Jul16 July 17:11

        I’d rather pay 230 pounds cash, or less, for a normal cash ticket.which has been thé coing rate for suite a while now. Plus i’d earn Avios and tier points.

  • N says:
    16 Jul16 July 12:53

    This is excellent news for the book-multiple-flights-and-cancel-the-ones-you-don’t-want crew

    • Russ says:
      16 Jul16 July 13:20

      La la la la la 🙂

    • Ben says:
      16 Jul16 July 14:13

      Good point…

    • BS says:
      16 Jul16 July 15:53

      Especially with strikes coming up, and EU261 being payable for every cancelled flight…

      • Rob says:
        16 Jul16 July 16:19

        The better deal is booking a few fully flex Club World and banking the tier points and Avios when the flight is cancelled, and paying the £15 fee to cancel the flight if it isn’t ….

        • @mkcol says:
          16 Jul16 July 16:28

          Now to figure which flights are most likely to be canx.

        • Lee says:
          16 Jul16 July 16:41

          I thought you would get full refund if flight is cancelled and don’t like the reroute, how can you bank tier points and Avios.

          • Rob says:
            16 Jul16 July 17:01

            You always gets your Avios and TP if your flight is cancelled and you choose not to travel, if you ask. This is standard BA policy. Done it myself.

          • lgflyer says:
            16 Jul16 July 20:43

            Do you still get the avios and TPs if the flight is cancelled a few months in advance and you decide not to travel and get a refund? I might have a claim in that case

          • Rob says:
            16 Jul16 July 21:10

            Well worth asking – say you chose to rebook elsewhere. They always give them during strike action.

        • eli says:
          18 Jul18 July 23:22

          just the thought of this is so cool and exciting.
          I almost only ever fly BA with Avios, so have 0 TP and 0 qualifying flights. getting a Bronze for cancelling LON-SYD while actually in TLV is just really cool.
          we’d need to follow closely for strike plans and prob more likely that short haul will bear the brunt of the disruption

    • BJ says:
      16 Jul16 July 17:38

      Seriously doubt it, if this becomes a standard feature BA can simply shut the door on such practices by charging an avios deposit fee of £35(+).

      • The Original David says:
        16 Jul16 July 21:37

        They already do, according to the cancellation terms on the avios ticket I’m looking at. How do we know they haven’t got rid of the “cancellation fee is capped at the cash element paid” rule with this change?

        • Rob says:
          16 Jul16 July 22:19

          Because it would require substantial rewriting of ba.com in how it processes cancellations, since it would need to ask you for £35 first, take the payment and then cancel your original booking. This has not happened.

          You can, of course, test this by punting 50p – remember to wait 24 hours as cancellations are free before that anyway 🙂

          • Gringo says:
            17 Jul17 July 14:19

            When they trialed this a couple of months ago, I was trying to get to Baku for the Europa League final. I booked multiple LHR-KBP/IST flights, and DUS/KBP/IST-LHR return legs all for 50p and avios, and successfully cancelled them all no problem.

  • AndyGWP says:
    16 Jul16 July 13:17

    Ok, so my brain isn’t working today and this genuinely feels like a stupid question, but I’ll go there anyways.

    If I was to use my last remaining Lloyds upgrade voucher, which historically I may have considered using for an RFS redemption of 8000 (ET price) avios @ £50’ish (CE fees)

    How would the (EuroTraveller) avios / (Club Europe) fees correlate (for dummy bookings etc)… or do they not?

    • AndyGWP says:
      16 Jul16 July 13:55

      Ah – just seen your 2-4-1 comment above… assume the same applies to the Lloyds voucher

  • Simon says:
    16 Jul16 July 14:06

    Only 50p coming back from Frankfurt on the flight I looked at.

    I imagine a lot of people will take the option as it’s the default without working out the maths. As someone said earlier if you book and cancel lots of flights the change could work out well for you.

  • pauldb says:
    16 Jul16 July 14:19

    I think this is a bit misleading:

    “The only question in your mind should be which of the other scenarios is best for you – all of them are basically letting you ‘buy’ Avios VERY cheaply by using more cash. The only issue is whether you buy a few for a very low price (8,000 Avios + £31 is the best ‘price per point’ spot) or buy a lot for a higher price (4,400 Avios + £81).”

    The 0.67p calculation makes the latter option seem sensible, but actually it’s compounding a good buy-up and a bad buy-up. You would be spending £30 to save 7k (back to the old offer), and then a further £50 to save a further 3.6k avios. That second half is unappealing.

    • Rob says:
      16 Jul16 July 15:16

      That is correct, but for someone looking for volume it still works.

    • pauldb says:
      17 Jul17 July 07:53

      Only if you’re will to pay 1.4p for the further 3600 avios. It’s like me offering you four £10 gift cards for £32 but you preferring six £10 cards for £54.

  • Ryan says:
    16 Jul16 July 14:29

    I often book 2 X One Way flights (if the inbound sector has taxes >£17.50 / £25. For example, flew PMO-LHR in CE on Sunday night at a cost of 15,000 Avios + £17.80. Whilst not a massive difference, the same flight would now be + £25. This will be the same with the various low tax flight options 🙁

    • marcw says:
      16 Jul16 July 15:02

      Use IbPlus Avios to book them.

    • Lady London says:
      16 Jul16 July 17:14

      I will be stitched up the same way. Make no mistake this will get BA more money overall not less.

  • nick says:
    16 Jul16 July 14:34

    about to book 4 x one way’s on Avios

    54000 Avios + £ 2.00

    47000 Avios + £ 35.00

    40000 Avios + £ 70.00

    What about cancellation fee’s? Would I only be charged £2 if I cancel? and get all 54000 avios back?

    • Rob says:
      16 Jul16 July 15:15

      Yes, that’s how I understand it – although I reckon they will change the cancellation rules if these become more popular. Lufthansa, and indeed avios.com in the old days, used to charge the canx fee to your credit card and then refund what you paid.

      • Mark says:
        16 Jul16 July 15:58

        Are you sure about that Rob, it does say “Cancellations: You can cancel this booking at any time up to 24 hours before outbound departure and receive a full refund, minus a service fee.” Service fee is listed as £35 for “Cancellation/ Avios redeposit”

        • Rob says:
          16 Jul16 July 16:16

          It has always said that, nothing has changed.

          • Mark says:
            16 Jul16 July 17:34

            Thanks Rob, just to be clear: you are saying BA will only charge me £2 and not the £35 if I cancel right?

          • Rob says:
            16 Jul16 July 18:28

            That is what I would expect unless ba.com has had a massive rewrite. They have ALWAYS capped the fees at the lower of £35 or the taxes paid. However, obviously they will start to lose a lot of money now so I would not expect this policy to remain unchanged if the trial stays long term.

          • The Original David says:
            16 Jul16 July 21:48

            Is it actually written anywhere on BA.com though, or is this all just based on happy accident from past experience? It would seem pretty reckless to suddenly start offering 50p cancellation fees…

          • Lady London says:
            17 Jul17 July 10:25

            @The Original David it has truly always worked that way. But as Rob says, if people start to abuse the £1 BA will have to be very quick in stopping the maximum loss being what you actually paid in taxes (regardless of ts and cs saying £35 for cancellation, factually what has been lost is whatever you paid if it’s less).

          • Rob says:
            17 Jul17 July 10:56

            The problem is, for eg, that if you have a big enough Avios pile and your parents live in Edinburgh, it is now very easy to reserve an Avios seat for every Friday night for the next 48 weeks. You use 2-3 of them, cancel the other 45-46 nearer the time. You’ve only lost £45-£46 which is easily worth it to guarantee you have a seat on the weekends you end up needing them.

      • Lady London says:
        16 Jul16 July 16:52

        Lufty still does that i think.

  • Nick says:
    16 Jul16 July 14:37

    Also, what happens if you booked outbound (one way) using a 24-1

    Then you now book the inbound onways using the £1 taxes offer.

    Then you call BA to merge the bookings and utilise the 2-4-1?

    What happens then?

    • Nick says:
      16 Jul16 July 14:39

      ie. how much Avios (if any) would be refunded?

      so (40,000 for the 4 outbounds + 54,000 for the 4 inbounds)

      Would they give back 13,500 avios?

    • Lady London says:
      16 Jul16 July 17:15

      *shudder* you think BA’s IT can cope?

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