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BA cuts Avios 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.

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.

British Airways £1 taxes on avios redemptions

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.

(Want to earn more Avios?  Click here to visit our home page for the latest articles on earning and spending your Avios points and click here to see how to earn more Avios from current offers and promotions.)

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Comments

  1. OT:

    Anyone know length of transfer for Virgin Flying Club to Hilton?

    Thanks in advance.

    • Roberto says:

      Been waiting a week this far for my transfer.

    • Not sure if they fixed the problem but the one I did back in April took about a month. The problem is with Hilton, not FC. FC may be aware how long it is currently taking so I suggest you ask them.

    • At least back in 2015, the transfer was achieved by someone at Virgin emailing a list to someone at Hilton monthly

  2. OT

    Anyway to claim vueling avios points after the flight has been taken?

    Also without the PNR. I do have both boarding passes

    • Two ways – into Vueling Club or Iberia. Not sure if you’d need to be a member of those schemes at time of flying to claim, however. No idea what data they need.

    • Marcw says:

      You can only retroclaim on Vueling Club. If you want IbPlus Avios + Elite Points, you have to add your IbPlus number during booking.

  3. OT- has anyone got same issue for AMEX MR account?
    This morning was trying to check my MR balance, couldn’t see it anymore on both web and app.

    • NvT1115 says:

      Same here – nothing showing on Plat or BAPP. Might just be a glitch.

    • NvT1115 says:

      Lee – I have just logged back in and pts balances now showing

    • TGLoyalty says:

      No balances were showing for any points for a while this morning.

      I’ve cashed out all my points with the self referral clawbacks in the USA so less worried.

      • Sandgrounder says:

        I was looking at the US terms and conditions this morning. They also warn they may claw back if you cancel or downgrade within a year.

  4. By implementing this change, BA has increased the cost of booking reward flights from airports with low taxes. For instance, I used to be able to book a peak economy reward flight from LUX to LHR for 4,500 Avios + £3.40 in taxes. The same flight now requires 4500 Avios + £ 15.50 in taxes.

    • pauldb says:

      Despite the terms still saying:

      10. In the unlikely event that the RFS Flat Cash Price is higher than the applicable taxes, fees and charges on a booking, the Eligible Member will pay the actual taxes, fees and charges applicable to the booking.

    • Marcw says:

      Book via IbPlus

  5. Akkers says:

    One thing that I don’t think I have seen mentioned, and I know it doesn’t impact all of us, is Gold Priority Reward (GPR). On the Nice example given, if there was no Avios availability but there was economy availability I could “force” BA to open up a seat for 16,000 Avios + £35. It is now going to cost me 30,000 Avios + £1.

    On GPR you don’t have the various alternatives so in effect I am paying an extra 14,000 avios but only saving £34 cash – that seems like particularly bad value.

    • The Original David says:

      Is it? Does GPR only have that single option for the cash amount?

      • I need to book some GPR so I will let you know!

        • Akshay Kumar says:

          When I used it earlier in the year for the Chania flight which was originally offered it was only one option.

  6. Prune says:

    OT I know this has been asked before but I can’t find the posts.
    1. Can you book 2 outward bound flights at 1 am with points and then add on the 241 voucher the next morning thus refunding the extra points?
    2.if I wanted to book via a call center which one is open at that time? Is it the US or Japan?

    Thanks so much

    • Do you mean return? Why would you want to do that with outward journey when all you need to do is click the option to use the voucher and have it properly priced online?

      • Prune says:

        I thought that you couldn’t do that if you were just booking the first leg of the 241 355 days in advance. I thought that this had to be done over the phone and then the return leg added on when it is released (for me 2 weeks later). I hoping to book the 2 outbound seats with miles then tack on the 241 the next morning.
        Am I missing something here?

        • Yes you are, you can book the outbound legs with your 2 4 1 but the voucher is then classed as used which is why you have to call to use the “return” element of it.

        • Yes, you can book a one way outbound at 1am online using a 2-4-1. No problem there, the option is clearly highlighted on the booking screen.

          2 weeks later you can call to add the return legs (others can comment whether US or Japan line is better).

  7. Louise says:

    When cancelling hotels they have got the money back but that was the Amex travel offer, not sure if they would do it for other retailers

  8. Amelia says:

    I’m wondering how this will affect 2-4-1 redemption.

    Is it correct that you need the full amount of Avios to use the 2-4-1 voucher and cannot part pay with cash?

    For example, Belfast to Barcelona, Club, return off peak I would need 61,000 + £2 and could not do 41,000 + £102 (which seems much better use of Avios point)?

    • Lady London says:

      @Amelia you are regarding 20,000 avios points as worth less than £100?
      That feels like about 0.5p value achieved per avios?

      • Amelia says:

        No, Lady London, I am saying that £100 is worth a lot less to me than 20,000 Avios.

        41,000 avios + £102 is almost exactly the same cost as before the change and I am not sure whether the old 2-4-1 rules still apply.

  9. Markpeterborough says:

    I started a trial avios booking under the new rates (London to Dublin) and clicked onto the cancellation terms and saw this

    Cancellation/ Avios redeposit² GBP35

    This looks like an increase on the previous cancellation fee for an avios plus taxes booking. Am I correct?

    • Polly says:

      Always been 35 canc fee or less if your payment wad under 35. Don’t think that’s changed..

  10. Wetboy1uk says:

    Its a bit disappointing that the amex 2 4 1 voucher does not woek with the 1quid taxes.

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