Air Passenger Duty explained… and a SECRET trick to avoid it

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Air Passenger Duty (APD) is a tax levied on travellers departing airports in the UK. While it began at £5 short haul and £10 long haul, it can now add up to £146 to the cost of a ticket.

avoid-air-passenger-duty

An announcement earlier this year by the Scottish Government said that there were plans to halve the APD when it became a devolved issue. The BBC discussed this in detail here. This will obviously favour travellers north of the border, many of whom feel they have been long-disadvantaged by the London-centric nature of the aviation industry.

I thought it was worth taking a look at some real life examples to illustrate how APD works and, better still, how you can swerve it.

All the following examples are based on travelling to New York in January 2017 on the same flights in Business Class on BA.

LHR APD

Direct from LHR – JFK, the return prices out at £1894.

Notice the line: United Kingdom Air Passenger Duty Apd (GB) £146.00

Add in a domestic connection from Aberdeen in Scotland, and the price increases to £1918 (so this connection adds on £24 but would earn you another 1000 Avios and 40TP in total, which I think is good value if it works for you).

ABZ APD

Again, notice the line: United Kingdom Air Passenger Duty Apd (GB) £146.00

So how do I avoid paying the £146?

There’s an interesting little trick, albeit not an entirely convenient one for everyone. APD is not chargeable when departing from Scottish Highlands and Islands, according to this extensive Government document.

3.2.3 Scottish Highlands and Islands

Passengers carried on flights departing from airports in the Scottish Highlands and Islands region are not chargeable passengers.

Passengers carried on flights from other areas of the UK to airports in this region are chargeable passengers and subject to APD at the appropriate rate.

The airports in these areas are shown below, including the reasonably well-connected (to London) Inverness.

H&I APD

This means that a flight departing Inverness will pay no APD, although a flight from London to Inverness would.

In our example, the INV-LHR-JFK cost has fallen to £1778, a saving of £116 on the direct London flight and £140 off the Aberdeen option. Like both the London and Aberdeen flight, the fare basis is still £707, but there is no APD.

INV APD

This is obviously great news if you are based in and around Inverness. That may be a slightly niche travel hack, but even where you are closer to Aberdeen or Edinburgh it might be worth it, especially if you were travelling as a group.

Beyond that, even if you are London based you could still save. If you were Avios- and time-rich, you could take a £17.50 Avios Reward Flight Saver (RFS) flight up to Inverness for a little sightseeing before flying back down to London for the New York flight (or do a back-to-back immediate turn around on the London-Inverness flight- as the daily rotation is on the same aircraft, there is no danger of missing the flight).

How else can you save on APD?

Well the obvious way is to start your flights outside the UK, and we covered this in detail recently.

Going ex-EU really is the best way to make serious savings on pricey UK flights. There are clearly savings to be made when starting your flights in Inverness, but these are still more expensive than starting in, for example, Dublin.

DUB APD

The cost is £1487 – reductions come from a lower base fare of £592, no APD, and a YQ fuel surcharge of £195.40 as opposed to £249 on the other options.

So what’s the best option?

Heading to Scotland to sweve APD will obviously work for some people, but in general you’ll find the best value comes from the ex-EU flights.

I am London-based, so for pure convenience the London flight obviously makes the most sense. However, weighing everything up, I’d go for the ex-Dublin option above. Why?

  • it is substantially cheaper (assuming I took a RFS positioning flight, I would save £372 in this option)
  • the DUB-LON legs earn 40TP because they are international
  • getting to Dublin is straightforward from London, and I could even consider a day or two there.

As a result, in the school holidays (when I have time on my side), I would certainly go for the ex-Dublin option, all things considered.

That said, the Inverness departure is certainly a good option for those who live in the Highlands and Islands, and near Inverness airport in particular. A reduction in APD would benefit other Scottish airports too, but I am not sure that it will be the disaster that Newcastle Airport think it will. People are unlikely to drive north for 2 hours to Edinburgh to get a flight to save a few quid on APD when they could fly from Newcastle to Dublin and then onwards and save hundreds of pounds, as demonstrated above!

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