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Get a refund to your American Express card? Here’s how it impacts your vouchers and bonuses

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A recent email from a reader reminded me that you may not be familiar with how American Express treats refunds when you have a spend target to hit.

With flight refunds still being triggered on a regular basis it is important to know where you stand.

The answer is simple:  all American Express spend targets are based on NET spend, not GROSS spend.  Your spending is adjusted for refunds, irrespective of when the original transaction took place.

How does American Express handle refunds

The “irrespective of when the original transaction took place” bit is important. Here is an example.

My British Airways American Express Premium Plus membership year runs to late February.  I need to spend £10,000 between late February 2021 and late February 2022 to receive my next 2-4-1 Avios companion voucher.

Let’s assume that I am about to receive a £2,000 refund from British Airways for a flight booked last December. Because it was booked last year, it counted towards my 2020/21 companion voucher.

When this refund turns up, it counts against my target spend for the current year.  This means that I will need to spend £12,000 this year – not £10,000 – in order to trigger my 2-4-1 voucher.

It makes no difference that the original purchase took place in my old membership year.  Amex deducts the £2,000 from my gross spending in this membership year so, to hit £10,000 of net spend, I now need to hit £12,000 of gross spend.

More obviously, the refund would also count against my £10,000 total spending if the original purchase has taken place in my current membership year.

The identical situation applies if you are working towards any other American Express spend bonuses:

  • Any sign-up bonus on any American Express card
How does American Express handle refunds

Does this apply to other card issuers too?

I don’t know, unfortunately.  It will vary on a case by case basis, but you should assume any award is based on net spend and not gross spend.

This would include:

  • A free night for spending £10,000 in a year on the IHG Rewards Club Premium Mastercard (no longer available to new applicants)

Want to earn more points from credit cards? – December 2022 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current 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

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

Barclaycard Avios card

Barclaycard Avios Mastercard

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

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

British Airways American Express Premium Plus

25,000 Avios and the UK’s most valuable card perk – the 2-4-1 voucher Read our full review

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

30,000 points and unbeatable travel benefits – for a fee Read our full review

Virgin Atlantic Reward+ Mastercard

15,000 points bonus and 1.5 points for every £1 you spend Read our full review

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

American Express Business Platinum

40,000 points sign-up bonus and a £200 Amex Travel credit every year Read our full review

American Express Business Gold

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

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

Capital On Tap Business Rewards Visa

10,500 points bonus – the most generous Avios Visa for a limited company Read our full review

For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.

Barclaycard Select Cashback credit card

1% cashback and no annual fee Read our full review

Comments (65)

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

  • Tony says:

    I cancelled a Platinum Amex card after transferring all points. The prorata refund of the fees and a cancelled flight have left the account in credit. Can any points issued be clawed back if I ask for the credit to be refunded?

    • VerdantBacon says:

      No they don’t claw back points, they’ll happily bank transfer the refund too. Though sometimes they only suggest transferring the credit to another Amex, you can ask for it back as a bank transfer

  • Gareth says:

    I have a potential refund problem on the horizon with the Virgin Atlantic Card. I’m just about to trigger the £10K 241 voucher and then plan to cancel the card (having read articles on here about Virgin applying next years £160 charge before your year is up). Problem is there is a £2K hotel booking on the card for March 22 which may well be cancelled and refunded. So what happens then? I understand there is a process for recovering such payments from closed cards but would Virgin call foul because the refund would take me under the spend target? Do I need to spend £12K on the card before closing to be on the safe side?

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

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