How to reclaim your credit card charges

What charges do credit cards have?

Credit cards have a range of charges and fees, but not all of them can be contested and reclaimed. The main credit card costs can include the following:

• Annual or monthly fees for holding the card

• Interest 

• Fees for services like ATM withdrawals, using the card abroad or transferring money to your bank account

• Fees for spending more than your credit limit

• Fees for missing a repayment

You can find out more in our guide about how to understand credit card charges

Which credit card charges can you reclaim?

Many charges cannot be challenged as they are contained in the terms and conditions that you agree when you take out a credit card. However, there are two situations when you can reclaim charges from credit card companies:

Fees charged in error

Sometimes providers charge fees by mistake because of human errors or computer problems. This can include adding fees when you have done nothing wrong or charging too much interest.

You can reclaim the full amount if you have been charged by mistake.

Contact your provider by phone, email, secure message or letter to explain why you should not have been charged. Ask for the fee to be refunded immediately, and for them to pay back any costs as well, such as:

• Interest charged on a fee amount

• If a fee pushed you over your credit limit and you were charged again for this

Fees that are too high

It is unlikely you will get a refund for annual fees, cash withdrawal charges, balance transfer fees or interest unless they were charged in error. This is because the amount charged will be specified in your card's terms and conditions.

However, you could still get some money back if your provider has charged an excessive amount for penalty fees for missed payments or going over your credit limit.

Credit cards used to charge fees of around £35 for missed payments or going over your credit limit. In 2006 the Office of Fair Trading (OFT) decided charges of more than £12 were unfair. This means you can usually only reclaim charges of above £12.

You can reclaim fees higher than £12 from the past six years in England and Wales or the past five years in Scotland.

How to reclaim charges on your credit card

If you have been charged fees that are higher than £12 for missing your monthly payment by a day or two or exceeding your credit limit accidentally, here is how to get your money back:

Work out what charges you can reclaim

Go through your old credit card statements and find the penalty charges you may be able to reclaim. Look out for circumstances where you may have missed a payment date by a day or two, or you accidentally went over your credit limit. These are the situations where the OFT will typically side with the borrower and deem the charges unfair.

Check your card's paper statements if you have kept them, or access them through online banking if this gives you full details for the past six years.

If you do not have access to all your statements, ask your provider for a full list of charges on your account going back six years. Your provider has to reply within 40 days and cannot charge you more than £10 for the information.

If they try to charge you more by insisting that you pay for a full statement, explain that they have to give you just a list of charges for £10 under the Data Protection Act.

Add up the total charges for:

• Late payments

• Going over your credit limit

Decide on how much you claim

You can either ask for:

• A refund of the full amount; for example if you had been charged £35 10 times you would ask for £350

• A refund of anything over £12 for each fee; for example if you had been charged £35 once you could ask for £23

If you ask for the full amount, your provider could say no because they consider it fair to charge £12 each time.

You could also add 8% annual interest to the amount you ask for because this is how much you would be entitled to if you took your claim to court.

Contact your card provider

Once you have decided how much to reclaim, write to your provider to confirm:

• How much you are asking for

• The dates and amounts of the charges

• Why the charges are excessive or unfair

If your claim is accepted

If they accept your claim, the provider will contact you to offer to repay the full amount or part of it. You will then need to let them know if you are happy with their offer.

If your provider does not acknowledge your claim, turns you down or offers you an unsatisfactory refund amount you should raise a complaint.

How to make a formal complaint

You can raise an official complaint by phone or in writing and let them know that you will take them to the small claims court or the Financial Ombudsman Service (FOS) if they still refuse your claim.

It costs nothing to involve the FOS, and they will review the claim and decide whether your credit card company should reimburse you. Your provider will have to refund you if the FOS tells them to. You can contact the FOS and make a complaint on the Financial Ombudsman website.

If the FOS rules against you, you could lodge a claim at the County Court instead, either in person or online. For more information, visit the HM Courts & Tribunals Service website.

Ways to avoid charges in the future

The best way to avoid a repeat situation is to make sure you are not charged any fees again. Keep in mind that you can make sure you don’t incur penalty charges by:

• Avoiding missed payments. Set up a direct debit for at least the minimum amount each month to make sure that you don’t miss a payment date.

• Keeping track of your spending through your online statements or smartphone app so you can easily stay within your credit limit.

• Creating a budget to help you manage your money each month and avoid spending more than you can afford to repay on a credit card.

Here are the charges you could face on a credit card so you can avoid them.