Urgent bill warning for millions falling for subscription traps – and how to avoid them
MILLIONS of households waste hundreds of pounds a year on unwanted, hard-to-cancel subscriptions.
Ministers estimate this adds up to £1.6BILLION across the UK, and will this week announce measures to clamp down on these so-called subscription traps.
Firms will have to provide clearer information when signing customers up, send reminders before renewals and make it easier to cancel, a Whitehall insider told The Sun.
But it could be months before the rules come into force.
Sarah Davidson looks at how firms sign you up for repeat payments, how to get out of them — and apps that help you spot and cancel unwanted subscription.
THE TRICKS
MOST subscription firms are legitimate, from recipe boxes to wine clubs, regular razor deliveries to restaurant discounts. They make it easy and appealing to begin a subscription, by offering a free trial or a big upfront discount.
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In the worst cases it’s so simple you don’t even realise you’ve signed up — you ticked the wrong box or missed small print about repeat payments. One in four of us have signed up to a subscription by accident, says Citizens Advice.
But then getting out requires a lot more effort, such as phone calls or scrolling through a firm’s website for an email address. It is known as sludge tactics, when firms make exiting a contract feel like trudging through mud.
CARD PAYMENTS
SUBSCRIPTION firms often use your card details to take weekly, monthly or annual payments. This is known as a “continuous payment authority”.
When Londoner Rob Windle, 45, signed up to a career and networking service over three years ago he thought he was making a one-off payment.
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Then this year £590 was taken from his card by a company with a different name, Actuate Global. He was told he had signed up for a subscription that would auto-renew every three years.
The new firm, part of the same group as the first, managed to take the payment although the card he first used expired in 2021.
He says: “It’s shocking that a company could take a big payment like this three years down the line, even after my card had expired. It was a nightmare getting my money back and cancelling.”
After we contacted the firm, it agreed a refund. A spokeswoman at Actuate Global said it emailed Mr Windle three reminders before taking a renewal payment. She said the auto-renewals and all other terms are clearly outlined to all new customers.
HOW TO CANCEL
IT’S your right to cancel payments up until the end of the day before the money is due to leave your account, by telling your bank or the subscription company.
If the payments do not stop after this, tell the company the date you cancelled and ask for a refund. If they continue taking money and refuse to refund you, tell the bank you dispute the payments.
Seek further help from Citizens Advice, at or on 0808 223 1133. But be careful if you agreed to a fixed-term contract, for example a year’s gym membership.
Depending on your contract, you might still be required to make ongoing payments for that period of time. Cancelling early might mean you get hit with a penalty.
Speak to the company and say why you need to cancel, for example if you have moved house or are in financial difficulty.
MOBILE BILLS
Some companies can add their charges to your phone bill.
Most mobile providers also let you pay for apps, music, TV and video-streaming services, and gambling and gaming services. You can be charged a maximum of £40 on a single purchase and up to £240 in each billing period.
You can cancel at any time by texting “STOP ALL” to a phone number you can get from your mobile provider. But it doesn’t always work.
One in four people who made payments via their mobile bill had been signed up to a subscription without their knowledge, says regulator the Phone-paid Services Authority. And one in five of these customers said they couldn’t stop the service.
If you see strange charges, ask your mobile provider to cancel the payments and block third-party charges.
Check your Apple, Google, Amazon or PayPal payment accounts and report subscriptions you don’t recognise.
They should cancel future payments but you must contact the subscription service to get your money back and confirm you’re cancelling.
THE APPS
SEVERAL free apps can help. Just download one to your phone, link it to your bank accounts and you’ll get a full list of subscriptions with instructions on how to cancel them.
Snoop, Money Dashboard, Emma and ScribePay all offer this service for free, although some charge fees for other features.
Several of the big banks such as Lloyds Bank and Bank Of Scotland will also let you cancel subscriptions in their own apps.
Shock tax bill for pensioners
MORE than half a million state pension claimants could be caught by a surprise tax bill following the recent payment increases.
Pensioners are being urged to check their tax position after the state pension rose from £185.15 to £203.85 a week or £10,600 a year on April 10.
While the increase is great news for pensioners, it means that hundreds of thousands more retirees will start to pay tax on their income.
That’s because the higher state pension payments might be enough to push their income above the annual £12,570 tax-free personal allowance.
Pensioners affected will be those who have a workplace pension or other earnings of more than £1,970 a year.
Jon Greer, head of retirement policy at financial advice firm Quilter, said: “Around seven million pensioners pay income tax and that’s set to grow significantly as the personal allowance remains frozen.
"If you have a very low income, you check your eligibility for government benefits, and you can use online government calculators to see what you can claim.”
He added: “If you are concerned about managing pension withdrawals and how much tax you will pay, it is worth seeking advice or speaking to Pension Wise.”
Pension Wise offers free hour-long appointments to over 50s who need help understanding their options, such as managing withdrawals and paying tax. Book at .
To get an estimate of how much income tax you are due to pay, try the tool at .
But certain types of income won’t trigger a tax bill. You can earn up to £1,000 a year from selling items online or any other type of side hustle.
You can also earn up to £1,000 a year in interest on savings without paying tax and even more if your money is in an ISA.
Flights boost
BRITISH Airways passengers who were given vouchers for flights disrupted during Covid now have an extra year to use them.
The airline has extended the period they are valid for another 12 months to September 2024.
British Airways’ parent company IAG said there were around £580million in unused vouchers at the end of last year, including those from other airlines in the group such as Aer Lingus and Iberia.
The airline has previously extended the vouchers several times to give passengers more time to use them.
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However, passengers who would have preferred cash instead of a voucher may still be able to get what they initially wanted.
If you accepted a voucher after your flight was cancelled but were not offered the option of a cash refund at the time, you can dispute this with the airline.