British Airways Visa Adds Carrier Surcharge Rebate and New Bonus Category

Aug 27, 2019

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Update: Some offers mentioned below are no longer available. View the current offers here – British Airways Visa Signature Card      

Hate British Airways award flight carrier surcharges? We’ve got a bit of good news for you. British Airways and Chase just announced two new benefits to their cobranded credit card, the British Airways Visa Signature Card, and one of those benefits will help cut down the cost of carrier surcharges on award flight bookings.

First, both new and existing card holders will receive up to $600 in statement credits each year to pay for flight taxes and fees — including surcharges — on transatlantic award flights departing from the US on British Airways. Specifically, business and first class awards are eligible for up to $200 in statement credits per award flight, while economy and premium economy awards get up to $100 in credits for each award flight. The total statement credits are limited to three awards per calendar year and only include flights on British Airways, though bookings may include a connecting flight on a partner for the non-transatlantic portion of the itinerary, according to the terms and conditions.

The card is also adding a bonus category. While you’ll continue to earn 3 Avios per dollar spent on British Airways, Aer Lingus, Iberia and LEVEL purchases, card holders will now also earn 2 Avios per dollar on hotel purchases booked directly through the hotel. All other purchases continue to earn 1 Avios per dollar.

The addition of the new spending category isn’t anything to write home about, as the earning rate is the equivalent of 3 cents per dollar spent based on TPG’s latest valuations. There are better cards for hotel spend, including either cobranded hotel credit cards or cards that earn transferable points on hotel stays. However, anyone who makes redemptions using British Airways Avios knows that one of the major downsides to the British Airways Executive Program is the massive carrier surcharges — previously called “fuel surcharges” — that the airline adds to its award flights. Depending on the route and seat, you can be on the hook for more than $1,400 in fees (yikes).

Now, if you’re paying $1,400+ in fees for a premium cabin award ticket, a $200 credit isn’t that big of a deal. However, some Avios redemptions could make more sense, especially on routes where British Airways recently lowered its surcharges. For instance, a round-trip economy ticket between Los Angeles (LAX) and London-Heathrow (LHR) would drop to as low as 32,500 Avios and $250 in surcharges with the credit, improving the redemption value versus the cash price for a comparable ticket.

Related: Maximizing the British Airways Distance-Based Award Chart

One of the ways we’ve suggested to circumvent excessive surcharges is by booking two one-way flights, which can lower the cost of carrier-imposed fees. While we originally speculated that you might be able to double dip this new benefit by applying it twice to two one-way awards, the terms and conditions indicate that only transatlantic flights departing from the US are eligible. Still, the benefit does apply to one-way awards, so by booking one award in each direction, you could get the benefit of both the new perk on the outbound flight, and the lower surcharges that result from separate one-way awards. Or you could even book your return flight with an entirely different mileage currency that doesn’t include surcharges.

Bottom Line

To be clear, we here at The Points Guy abhor surcharges, whether they’re referred to as fuel, carrier or otherwise. A free award ticket should be free, or as close to free as possible, and an airline that tacks on enormous surcharges is damaging its own program in the long run. We’d prefer to see British Airways simply lower or eliminate its award ticket surcharges across the board.

But for now at least, surcharges are the reality at a number of airlines, and anything that helps reduce them is a step in the right direction. While the best use for Avios will still likely be short hops on American or other BA partner airlines, even if you only make one long-haul award redemption on British Airways each year, the savings from this perk will easily offset the $95 annual fee on the British Airways Visa. Plus you can currently earn up to 100,000 bonus Avios if you sign up for the card now — 100,000 Avios after spending $5,000 in three months, and an additional 50,000 after spending a total of $20,000 in the first year. Those 100,000 Avios are worth $1,500 based on TPG’s valuations.

So if you’ve been on the fence about applying for the British Airways credit card, now’s a good time to add it to your purse or wallet — you can pick up a haul of Avios and reduce the amount you’re paying in surcharges on British Airways flights at the same time.

Interested in the British Airways Visa Signature Card with up to 100,000 bonus points? Apply here.

This story has been updated with additional information from the terms and conditions of the new surcharge benefit.

British Airways Visa Signature® Card
Apply Now
More Things to Know
  • Earn 100,000 Avios after you spend $5,000 on purchases within the first 3 months from account opening.
  • Earn 5 Avios per $1 spent on purchases with British Airways, Aer Lingus, Iberia, and LEVEL within your first 12 months from account opening, thereafter earn 3 Avios.
  • Earn 3 Avios per $1 spent on hotel accommodations when purchased directly with the hotel within your first 12 months from account opening, thereafter earn 2 Avios. Plus earn 1 Avios per $1 spent on all other purchases.
  • 10% off British Airways flights starting in the US when you book through the website provided in your welcome materials.
  • Every calendar year you make $30,000 in purchases on your British Airways Visa card, you'll earn a Travel Together Ticket good for two years.
  • Pay no foreign transaction fees when you travel abroad.
  • Simply tap to pay with your contactless British Airways Visa Signature Card. Just look for the contactless symbol at checkout. It's fast, easy and secure!
Regular APR
15.99% - 22.99% Variable
Annual Fee
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Good, Excellent

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.