Reader Question: Do hotels charge taxes and fees on Hyatt Points + Cash awards?

One of the biggest advantages of redeeming points for hotel rooms is that you typically don't pay taxes on award stays. That sets hotel loyalty programs apart from airline frequent flyer programs, which routinely add costs like taxes, airport fees and carrier-imposed charges to award tickets. These favorable hotel policies can mean huge savings, especially at more expensive properties.

But what about stays paid with a mix of points and cash? Do they confer this same privilege? TPG reader Jonathan reached out to us to ask exactly this.

[pullquote source="TPG Reader Jonathan"]Do you have to pay taxes and fees on Hyatt Points + Cash stays?[/pullquote]

For more TPG news delivered each morning to your inbox, sign up for our daily newsletter.

Taxes and fees on points and money awards

All of the major hotel chains offer some form of points and money awards. While they work slightly differently across each program, the concept is simple: you get to save points on an award night by spending some extra cash.

Although these are still considered award nights, they don't get all of the same benefits.

World of Hyatt charges taxes on the cash portion of its Points + Cash awards. Sometimes taxes are improperly applied to the full cash rate, so it's important to look over your bill at checkout and make sure you aren't being overcharged. On the flip side, you will earn points for the cash portion.

Related: Try this if you can’t find the Hyatt award you want

When you're booking a Points + Cash award, you may incur extra charges, such as occupancy taxes or resort fees. Although sometimes waived on normal award stays, they do apply to Points + Cash stays. These charges will a fixed cost per stay or night.

All fees should be indicated upfront when you make your reservation, but sometimes you'll need to check the fine print. If you incur additional charges that aren't mentioned up fron, take it up with management or seek a refund through customer service after the fact. Make sure you save any relevant documents that back up your claim.

Related: 5 pitfalls to avoid when booking hotels

Even though you have to pay taxes, Hyatt's Points + Cash awards can sometimes offer good value. Although you no longer pay a set amount of cash on these bookings based on hotel category, you can still save 50% off the standard rate while paying half the required points. Once peak and off-peak pricing goes into effect in July 2021, you'll be able to save between 50% and 70% on these bookings. In other words, do the math to see which booking option makes the most sense.

Keep in mind, World of Hyatt also recently introduced a new feature called Pay My Way. It lets you book one reservation for multiple nights and pay using various methods for each night. This can be another useful option if you don’t have enough points to cover your entire stay and don't want to go the Points + Cash route. Alternatively, if you're short points, there are many ways to boost your World of Hyatt balance.

Related: The best hotel credit cards

Bottom line

Plenty of hotel chains offer points plus cash programs in some form. Unfortunately, though, these stays don't get all the same benefits as standard award nights. In each case, expect the rules to be similar to World of Hyatt's Points + Cash awards. Taxes should apply to the cash portion of your bill, and you may be responsible for other fees depending on the property and location.

Thanks for the question, Jonathan, and if you’re a TPG reader who’d like us to answer a question of your own, tweet us at @thepointsguy, message us on Facebook or email us.