Q&A

Credit card charges

I was told (by someone selling Ryanair credit cards, in fact) that if you have your credit card account in credit on April 1st, you are not liable for stamp duty. Is this true?

Mr T.F., Dublin

No it is not. Every credit card account is liable to the stamp duty charge of €40 per annum on a year that runs from April 2nd to April 1st. This stamp duty is laid down in the Finance Act and cannot be amended or dismissed by any credit card provider. Whether your account is in credit or not is irrelevant as far as stamp duty is concerned.

What is possible is that the card provider - who is responsible under the law for collecting the stamp duty on behalf of the Government - may choose to waive the charge to the customer and bear the cost itself.

This is the case with Ulster Bank, which has offered to pay an amount equivalent to the stamp duty to customers spending above a €5,000 limit annually. The limit is not particularly high and, presumably, Ulster Bank reckons to make up that lost revenue through interest charges on new credit card accounts.

So far, it seems to have worked as Ulster Bank has attracted more new credit card customers than rivals in the first half of 2003 according to surveys.

I have looked at the Ryanair website briefly and can find no mention of customers having their stamp duty paid for them by the company or by MBNA, whose card Ryanair uses.

In any case, such gimmicks are only one element of the equation for those choosing credit cards. Of far more importance, especially for those who do not pay off their bills in full each month, is the rate of interest charged and the interest-free period - the maximum amount of time between the making of a purchase and paying for it without attracting interest.

One point of interest is that you can have more than one card on the credit card account while paying only one €40 stamp duty bill. This is something that might appeal to couples or, indeed, parents and children - although I would caution there is a lot more to shared accounts than the saving of stamp duty. Shared accounts are liable to leave one person - the main accountholder - holding the can for any liabilities built up by other cardholders - a situation that is not beyond comprehension either through other cardholders losing track of their spending or the break-up of a relationship.

Irish Nationwide

Some weeks ago, Mr D.K. wrote about his mortgage with Irish Nationwide. He took the mortgage out in September 2002, fixing the rate of interest for six months.

At the end of that period, the building society offered Mr D.K, a variable rate of 4.48 per cent.

He queried the rate, pointing out that it was higher than any rate on the list of variable mortgage interest rates in this newspaper and elsewhere at the time. Staff at the society insisted it was the best rate on offer from them.

Unfortunately, that was not true. At the time, Irish Nationwide was offering and advertising a variable rate of 3.98 per cent - a full half percentage point lower than Mr D.K. was being offered.

Furthermore, as Mr D.K. suspected, following prolonged adverse publicity about its interest rate policy, Irish Nationwide had committed itself to offering the same variable rate to all mortgage customers who had taken out their loans with the society in or after January 2002 - nine months before Mr D.K. took out his mortgage and 15 months before he was quoted a variable rate out of line with this policy.

Having contacted the society, I am happy to say it has eventually accepted that Mr D.K. was not offered the rate he should have been. Irish Nationwide has agreed to reduce the rate he is paying to the current market rate - 3.48 per cent following the most recent half-point cut in interest rates. It has also agreed to refund any overpayment on his account in the intervening period.

Irish Nationwide is to be congratulated on putting things right for this customer. However, its explanation - that staff had yet to become fully used to the regime 18 months after it came into operation - beggars belief. Either it has very poor communications or very ill-trained staff.

It is also depressing that Mr D.K. had to approach the society through the media before his situation was put right. His attempts to correspond with the society came to naught.

One can only hope that every customer with a valid complaint does not have to gain national publicity before receiving what would be considered normal customer service.

Credit cards

In a busy restaurant, I was hurriedly presented with my credit card docket, which was swiftly taken away again. Only later it crossed my mind that, although I filled in the gratuity, I believe I did not sign it. What are the positions of the credit card company, the restaurant and myself?

Ms E.B., Dublin

The first thing is that, if you have any doubt that you paid a bill - in this case by credit card - for goods you purchased and over which you had no complaint, you should immediately contact the outlet and make sure that there is no problem. Otherwise, effectively, it is theft.

Granted, the restaurant staff should have checked to make sure all elements of the transaction were in order - including checking your signature against the one on the card (a practice that is becoming increasingly rare) before removing the chit and returning your card to you - but at the end of the day, you too have a responsibility in the matter.

In formal terms, you entered a contract for certain goods and services and these were provided (you make no reference to any dispute over the food or the standard of service). Your end of the contract is to pay for the goods and/or services provided.

In practical terms, what will happen? Technically, the credit card company should return the chit to the restaurant. It has not been signed and, therefore, is not valid. Even if the card has been swiped through a card-reading machine, as you indicate in your letter happened judging by the configuration of the chit, the transaction is not valid until you sign the chit.

Certainly, if there is any history of uncertain transactions with the restaurant, this is what will happen. However, it is possible, although wrong, that the card issuer would bill you on the basis of the card number and wait to see if you will pay.

As for you, you can query the item and have it taken off your bill if you feel it is there by error. However, in this case, you are unlikely not to remember the incident and will clearly recognise the item for what it is. In any case, if you cause not to be paid an item you know to be genuine, you run the risk of fraud charges should an investigation find otherwise.

All told, quite apart from the rights and wrongs of it, it hardly seems worth the risk. Just go back and pay the bill - and make sure it does not appear twice on your credit card statement!

Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries. All suitable queries will be answered through the columns of the newspaper. No personal correspondence will be entered into.