[SimonS1]

Pixelmeister – not a similar scenario at all.

1, In the case of the lamp you are physically taking the product back (no doubt incurring costs of time, travel, parking etc). If you bought it online you may well have to pay a shipping/handling cost. So it isn’t free.

2. In the case of the lamp they are refunding you the underling price of the product. Your flight was free so there is no underlying cost of product to refund you.

3. The terms and conditions for each offer are clearly set out at the outset and are different. Not everything bought in a shop sale is non refundable – I bought a shirt in a Paul Smith sale the other day, clearly stated as non returnable, non refundable apart from statutory rights.

Most people would acknowledge that in buying a flight that was ‘free’ (even though there are taxes) there would be strings attached bearing in mind the total cost of £25.99 is little more than the price of a train ticket from London to Brighton.

The conclusion – if your travel times are likely to change then buy a flexible ticket or be prepared to lose your money. If you are the type of person who tends to be a victim of misfortune then travel insurance is the answer.

[MartynSinclair]

SimonS1, the flaw in your argument is that irrepsective of whether the ticket is refundable or not, the airline is collecting money that it is not being passed (presumably) on to whom it was intended, instead claiming that the cost of refunding the said money has a cost.

What has not been mentioned as far as I can see, is who actually keeps the taxes and all the other add ons that are paid, in the event that a passenger doesnt fly. Does the airline still have to pass the APD and taxes to the relevant airport departments and Governement offices or do they just dissappear into the airline accounts?

[Binman62]

Airlines only ay money to the HRMC or airport and other authorities based on the number of passengers who actually depart ( or arrive) on any given fligth.

For large carriers this is an automated process via their finance departments and the departure information is also generally sent directly to the airport authority along with all other post departure information. This typically occurs around 0000 hrs and is part of the information that also auto updates your BAEC account with miles and tier points.

This figures are audited and HMRC and others do conduct checks.

As a result, airlines are retaining those funds collected on behalf of other agencies when the ticket is purchased unless of course they refund them.

[Bucksnet]

Exactly, charges and taxes can be remitted in an automated process, so the refunds for unused tickets can as well.

[MartynSinclair]

so if airlines are collecting money for taxes etc, they are collecting on behalf of the agency/treasury or who ever these payments should be directed and paid to.

The passenger doesnt travel, the airline does not need to pay the payments made for tax to the Government or airport authorities.

Is this not considered as fraud! How can an airline invoice for a tax and then keep the money, I know the airlines are not liable to FSA regualtions, but if they were, this would be considered as an exteremly serious offence, abit like the jailed policitians making claims for expenses that didnt exist

[NTarrant]

Martyn, it is not fraud. The airlines are acting as unpaid tax collectors the same as other businesses collect VAT. However if you cancel say a hotel booking (in the UK) that is booked under a non-refundable rate, the VAT still goes to HMRC. However in the case of the airlines the money only becomes due from the airline when a passenger travels. So as Binman says at 0000 tonight they will account for all those passengers travelling today.

Depending on the terms and conditions of the ticket it depends on what a customer gets back. Fully flexiable, the lot. On other tickets it depends on the conditions so if they say you get the taxes back less an admin fee then the amount that was taxes due back to you becomes and admin fee and you get the difference. So it is quite okay for them to as you say invoice for tax and keep the money, sadly!

[MartynSinclair]

Nigel, it is a little more acceptable (but still leaves a stale taste) for HMRC to collect the VAT on an unused hotel booking, after all, the goods have been purchased and the client retains the right to use up until 23.59 (presumeably).

The taxes due for airline travel though is a different scenario. Passenger buys ticket, which includes tax, passenger doesnt travel, ticket is non flexible, airlines should have to pass the tax money to HMRC or whoever, instead, they either refund with an admin charge OR KEEP IT!

Will the tax that the airlines keep go in their profit colum and then they are taxed on the tax as a profit…………………sorry, help me out here a little…………….Thanks

[Swissdiver]

When it comes to VAT, and to my little knowledge, anything that is collected must go to the relevant tax authority. And once it is paid, it is paid.

What’s about the other taxes? When it comes to flying, most of them must be used to be due. So imho, airlines must reimburse them upon cancellation whatever the ticket conditions are…

It leaves us with the fuel surcharge, something classified as a tax but that became actually part of the ticket price, a part we have to pay when using air miles! Clearly an unfair practice. This is why I want to dig in with the case I quickly presented earlier in this thread…

[craigwatson]

Martyn – the taxes are always refundable even on a non-refundable ticket, the problem is they can and do charge an “administration fee” to process this, but this is normally only £30-50, so you will get some back, the problem is that the “fuel surcharge” is just that, a charge, or a surcharge, and therefore non refundable. with the FS element comprising around 80% of the “taxes, charges and fees”.

Now I dont agree with this, Ive always thought the FS should be incorporated into the fare, and the admin fee should be a true reflection on costs involved in refunding the money, but those are different issues.

[AMcWhirter]

Swissdiver, the question of taxes is a complex one and I would imagine it will vary from country to country.

Here in the UK, the HMRC tax point for our APD is when the plane lifts off the runway so, until that time, it cannot be considered as tax. But the rules/laws in other countries will vary.

[MartynSinclair]

I wonder how the airlines account for keeping the unpaid ‘tax’ in their accounts if the APD + other charges have been paid, but the passenger doesnt fly or doesnt qualify for a refund.

Sounds like a good source of income, if you can get it – no wonder the airlines want to charge an admin fee for giving it back!

[craigwatson]

If you dont fly the APD is refunded minus the admin fee, which would be transfered to a seperate misc. account or some such i would imagine.

[MartynSinclair]

and if the passenger doesnt apply, qualify or the admin charge makes it uneconomical for a refund – the airline gets to keep the APD………………..?

[craigwatson]

if the passenger doesnt apply then yes, the airline keeps it, as it should, what is it suppose to do with it? the passenger will ALWAYS qualify if they dont fly for refund of APD minus admin fee. the admin fee is lower than the cost of a business class APD charge, so there will always be SOME amount of taxes to be refunded.

the airline gets to keep the ADMIN fee, not the APD.

I know its just messing with words, ie changing APD to ADMIN, but so are alot of things in life.

there is nothing wrong with the system as is, EXCEPT the amount charged for the ADMIN fee, it should be around £5-10

[NTarrant]

Of course it does depend on the airline, certainly a few years ago when Mrs T was unable to travel with me to HKG, we had booked CW with miles to upgrade. They contacted me the next day to find out why she had not travelled and where we wanted the letter confirming the amount of money which was lost to be sent to.

I was told there was a refund of the taxes less an admin charge which was credited to my account by the time I got home

[Author]

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