Earn MASSIVE Avios (Or £100s In Cashback) On Cheap 12 Month Phone Contracts

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If you are in the market for a new mobile phone, you might well want to take a look at the cashback rates TopCashback is offering on Tesco Mobile contracts.

As you can see below, you could get up to £255 back, which could be converted into 26,775 Avios (given the 5% transfer bonus):

Note that the amount you will receive depends on two things – the type of phone you want (iPhone, Samsung, other), and how much you pay each month.

The stand-out value on the current list is the £225 for contracts costing £16+ per month that are not iPhone or Samsung phones: 

Presumably what Tesco Mobile wants you to do is to take a long 24-36 month contract out, so that the cashback looks impressive but doesn’t hit their bottom line too much overall. The thing is though, you can change the contract length on most phones to just 12 months – and that’s where things get really interesting.

When you shorten the contract length, the amount you pay each month naturally increases – putting you into the higher cashback bands, despite you actually paying less over the total length of the contract.

For example, you can currently pick up a Motorola G8 Power Light (with 500MB data, 5000 minutes & 5000 texts per month) for £11.99 per month over a 36 month contract. That would earn you £120 cashback and would be a pretty bad deal overall. Or, you could reduce the contract length on the same phone to 12 months and pay £19.97 per month:

As that is over the £16+ (pre-VAT) cashback threshold, you would earn £225 cashback.

12 months x £19.97 is £239.64, minus the £225 cashback, and you would effectively pay just £14.64 in total.

To be clear, that is £14.64 in total for a phone that costs ~£100, plus you get 500MB data, 5000 minutes & 5000 texts per month for 12 months.

Alternatively, you could transfer the cashback to Avios and receive 23,625 Avios, given the standard 5% bonus. 

I would personally recommend sticking to cash at the moment.

500mb of data clearly isn’t sufficient for many people these days, but if you’re not a heavy user, you could upgrade to 3gb for an extra £3 per month (so £36 more in total over 12 months). If you are a heavy data user though, you would almost always be better off just getting a separate sim only deal elsewhere. You would still be effectively buying a £100 phone for £14.64.

Anything to watch out for?

Yes, there are a few potential issues:

  1. As with all significant cashback stuff, remember to clear your cookies beforehand so it tracks properly, don’t use a VPN etc, and understand that on some very rare occasions, cashback deals don’t work out. With TopCashback and Tesco Mobile, I’d be confident any issues would eventually be resolved.
  2. The reviews suggest that the cashback takes a long time to become payable. 6+ months is common, so it’s important to be aware of that.
  3. The terms state that the cashback amount is determined excluding VAT. If you are not sure how to work out what the pre-VAT amount would be, use a VAT calculator.
  4. This does not tally with my personal experience, but it is important to be clear that the terms state that “the cashback rate is calculated on the airtime data only”. Clearly, if enforced, this could have a significant impact on the amount of cashback you receive, although there is still plenty of value to be found. The safest method would be to work out your cashback on that basis, and then if it ends up being higher than anticipated, see it as a bonus.

Bottom line

The example used above may not be the flashest phone in the world, but for most people it will work just fine. I’ve had various Moto phones over the years and never had a problem with them.

Regardless, it is just an example – have a look at what else is on offer and run the numbers for yourself – there are plenty of potential bargains.

Comments

  1. Iain Franklin says

    Whilst the wording of the individual cashback line suggests otherwise, beware the terms and conditions, specifically the one which says “please note that the cashback rate is calculated on the airtime data only” and the one which says “the merchant calculated cashback excluding VAT”. In your example this would be a value of about £10, well below the trigger threshold

    • Joe Deeney says

      Ah yes – great point on VAT (will amend in a moment). I took out a very similar offer before Christmas that has tracked at the amount expected (admittedly with a bit more data which would have taken care of the potential VAT issue) though, so I’m not sure about whether the airtime limitation is the case in practice. However – will of course update to make clear.

  2. cinereus says

    It’s actually a good idea to use incognito mode as there’s no chance of other tracking cookies interfering with cashback and there’s also likely to be fewer extensions active to make something go wrong.

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