American Express - Business expenditure, personal gain!

[russy01]

Morning all..

12 months ago AMEX approached me asking us to open a business account and hook the card into our Paypal account and pay any bills we could with Paypal to earn AMEX points. It cost me nothing, so I obliged and have put about £800k through the card earning 800,000 points along the way - nice little bonus, currently sat in my account waiting for airlines to return to normal or can be exchanged for a £3500 credit on Amazon!

Anyway, I have had another email from them just this week asking us to put all of our business spend through them, supplier payments, payroll, you name it. They say they will be able to pay my suppliers via BACs etc and still earn points.

I think it's probably a waste of time as the numbers wont stack, but before I waste time with one of their sales guys has anybody else looked into this. If the numbers worked out, i.e the costs for Amex to process said payments was low enough and the value of the earned points was high/flexible enough then there is potential...

Cheers.

[LaurasOtherHalf]

How does that stack up from a tax perspective? You're receiving a benefit from your businesses spend.

[russy01]

LaurasOtherHalf said:

How does that stack up from a tax perspective? You're receiving a benefit from your businesses spend.

I’m pretty sure loyalty points aren’t taxable. But I’ve not even got this far yet - just swapped out NatWest cards for Amex and pretty much forgot about the points accumulating.

[Mr Pointy]

How are they going to make money out of it? Will they be charging you for each payment transfer made? I trust it woud be less than your banking currently costs.

[LordHaveMurci]

russy01 said:

LaurasOtherHalf said:

How does that stack up from a tax perspective? You're receiving a benefit from your businesses spend.

I’m pretty sure loyalty points aren’t taxable. But I’ve not even got this far yet - just swapped out NatWest cards for Amex and pretty much forgot about the points accumulating.

My Chartered Accountants told me they’re not taxable.

I’ve earned in excess of £2.5k pa & not declared it.

[loafer123]

Mr Pointy said:

How are they going to make money out of it? Will they be charging you for each payment transfer made? I trust it woud be less than your banking currently costs.

The vendor pays fees on the transaction, I presume.

[russy01]

Mr Pointy said:

How are they going to make money out of it? Will they be charging you for each payment transfer made? I trust it woud be less than your banking currently costs.

I think it’s a flat rate charge. I’ve seen something like £100k transactions at 1%.

[Sy1441]

This sounds too good to be true. I could earn similar amounts to you doing this, do you have a contact? I already use Amex as a personal customer.

[The Moose]

You can sell Amex miles for a lot more than you can redeem them for.

[russy01]

Sy1441 said:

This sounds too good to be true. I could earn similar amounts to you doing this, do you have a contact? I already use Amex as a personal customer.

I’ve actually written the chap an email earlier today, asking how it would work on much bigger amounts.
The 800k I’ve mentioned is our current CC spend I.e Im just using Amex instead of another CC.

But what I’m interested in is adding all the lumpy bills like stock purchases etc (>10x that) - very interested to see how the numbers stack up.

I’ll let you know when he comes back.

[russy01]

The Moose said:

You can sell Amex miles for a lot more than you can redeem them for.

Yes appears to be lots of brokers in the US. I can sell my current balance of 800k points for $8500 - paypal transfer.

[QuartzDad]

It's a fairly common scenario, check out the Amex forum on Flyertalk for all the advice and indignation that it doesn't automatically qualify the cardholder for a Centurion card....

[David Beer]

russy01 said:

I’m pretty sure loyalty points aren’t taxable. But I’ve not even got this far yet - just swapped out NatWest cards for Amex and pretty much forgot about the points accumulating.

Did you ask your chartered accountant on this subject. ? Not done it myself of course, just curious. !
I do have two Amex, one for personal.

[chml]

https://www.gov.uk/hmrc-internal-manuals/employmen...

It's been a while since I looked at this but ISTR that it can have an impact if the employee gains from the employers points etc. I'd imagine you've a Ltd Co at that type of spend so the points belong to the Ltd Co and not you for you to spend personally.

[voicey]

I would like to thank the OP for this thread. I had never considered putting our spending through a card to accumulate points before. A quick call to my main suppliers to check they accepted AMEX and a very painless online application and we're approved - a gold card for me and my head engineer on the way. I reckon we can put through £250k pa through easily.