compensation offered, should I take it?

vt612

Hi everyone, I am a long time reader of the forums but this is my first time posting.



Virgin credit cards made an error on my 0% credit card and they were taking interest out of my payments when they shouldn't have. I complained, they looked into it and now offering the following


all interest has been refunded and this will reduce my balance (this is already done).


To cover the period I was without funds they calculate compensation at 8% giving a figure of £78.56. They deduct 20% tax of this which is £15.71


On top of the above they are offering a one off payment of £25 as a gesture of goodwill. It does not state but I imagine they will tax this too?


Overall I will receive 103.56 less tax, so just over £80.



I am not a greedy person, but on the other hand I don't want to let them get away with it too easily either.


I had a frankly awful customer service experience with their representative, the lady over the phone was not helpful at all, she showed no sympathy whatsoever, when I realized I was being overcharged several hundred pounds and called them to work find out why. She kept telling me that I made a late payment and so the promotional 0% rate has been removed and that was that.



So I just wanted to ask what everyone's opinion is, should I just take what is offered and shut up, or do I take it to the FSCS / ombudsman to try and get a bit more compensation out of them.



TIA

[Deleted User]

That's a very generous offer.

Reject it if you want, but prepare for them to remove the £25 goodwill gesture, which you obviously wouldn't have been taxed on.

Craig1981

happy to hear it is all sorted.


Compensation is just that - compensation. you wont get more out through the ombudsman, and the grief you will go through to put your case through is IMO, not worth it.


I would accept the offer they have given.

Dobbibill

The £25 will not be taxed.

It's your call - if you accept the offer you can move on.If you reject it, it's going to drag on.

They've put you back in the same position financially with the interest refunds plus the 8%.

I would say it's a fair offer.

vt612

thanks everyone


I will accept their offer.

PROLIANT

Compensation is to reimburse you when you are out of pocket due to the actions of another party, not a get rich quick scheme.
Accept it, be grateful they have acted reasonably and move on - get a better paid job if you want more money in your pocket.

agrinnall

On what basis are they deducting tax? Are they claiming to be operating PAYE for you? Do they have your NINO so that the tax deducted can be credited to your personal tax account?



It seems to me that they should be paying the full amount of compensation, and if any of that is taxable it is up to you to declare it and have it taxed by HMRC.

PRAISETHESUN

I'd accept it. I would also ask for it to be paid gross and then declare any taxable element of it to HMRC myself if this is an option

BoGoF

The 8% interest element will be taxed in the same way that PPI compensatory interest is taxable. You may be able to claim it back from HMRC depending on your tax status.

vt612

PROLIANT wrote: »

Compensation is to reimburse you when you are out of pocket due to the actions of another party, not a get rich quick scheme.
Accept it, be grateful they have acted reasonably and move on - get a better paid job if you want more money in your pocket.

already said I will accept, right above your post. So really no need for the patronising comment that added nothing to the thread.

derps

agrinnall wrote: »

On what basis are they deducting tax? Are they claiming to be operating PAYE for you? Do they have your NINO so that the tax deducted can be credited to your personal tax account?

It seems to me that they should be paying the full amount of compensation, and if any of that is taxable it is up to you to declare it and have it taxed by HMRC.

PRAISETHESUN wrote: »

I'd accept it. I would also ask for it to be paid gross and then declare any taxable element of it to HMRC myself if this is an option

They are legally required to deduct tax at the basic rate and pay it to HMRC directly. If a claimant is entitled to it back or should actually be taxed at a higher rate it's their responsibility to sort it with HMRC.

It's childish to always assume that banks do things just to be evil.

PROLIANT wrote: »

get a better paid job if you want more money in your pocket.

Wow what an insight, I wish I had thought of that years ago. Are you a financial adviser????