We are all used to paying Air Passenger Duty (APD) but in November of this year (2009) it is set to rise quite considerably. Key Travel have put together this document to offer you a better understanding of the new tax, how much it will cost you and how you could make savings to compensate for the extra cost through tactical purchasing, as well as how we could collectively put a case forward to the government for the implementation of preferential terms for the not-for-profit sector.

APD: What is it?

Air Passenger Duty is an environmental tax charged by the UK Government on all flights departing from the UK.

How much do you pay now?

In February this year APD was increased by 50% to £10 for flights departing from the UK to European destinations and £40 for all other destinations.

How much will you pay from 1^st November?

The new rates are detailed in the table below, and you will notice that the tax has been split into 4 bands compared to the current 2, based on the distance travelled from the UK. You will also notice that the table includes fees for 2009-2010, this is because the tax is set to rise again in November of 2010.

How we feel about it

As ambassadors for the not-for-profit sector we feel that APD is an unfair tax and have been lobbying to raise awareness of the significant impact it will have on our Third Sector clients. We believe this will deflect vital funds away from aid and development work and hit educational institutes who are currently facing budget cuts. The impact of this is outlined in an article we recently had published in The Times.

What can we do about it?

Making savings in the short term….

We understand that travel is an essential and unavoidable part of the work of the not-for-profit organisations we serve, so we have compiled a list of money saving hints and tips to soften the blow of the soon to be increased APD and keep you on the move. But before you do, ask yourself the following questions:

• Is your journey absolutely essential?
• If you are travelling within the United Kingdom, or a short journey within Europe, can you travel by train instead?

Tip 1: Book in advance

The smaller the gap between the booking and departure date, the higher the price for the journey. This is because the majority of airlines make their cheaper seats available first, even when travelling in the same class (e.g. Economy)

Tip 2: Take advantage of Charity/Academic fares

Be sure to ask about our Charity/Academic fares. These can be considerably cheaper, and offer increased flexibility and benefits, adding up to big savings.

Examples:

• Flying one way to Buenos Aires with BA on 10th November 09 costs £1807.70. On our charity rate it costs £457.70, that’s a saving of 75% on the published fare
• 1 bag of excess baggage weighing 10kg costs £72 if ordered online (£90 at the airport), but would be free with a specialist fare thus making a saving on the above fare of over 20%
• No airline cancellation and amendment fees, saving up to £75 each time an amendment is requested, and the full price of the fare when compared to the conditions of standard published fares 

Tip 3: Be flexible

Airlines tend to offer much lower fares on certain routes if you are flexible with your travel times. Ask your TMC for travel options around your preferred departure date/time to see if you can get an improved rate, even after allowing for the possible cost of an extra nights accommodation. Being flexible by even a matter of hours can make a difference to the fare.

Example:Flying with KLM from London to Lima in November 09 would cost £712 if a Saturday night stay was included in the itinerary, compared with a fare of £1217 if no Saturday night stay were to be included, making a saving of 42%.

To download this whitepaper as a PDF click here

Fares calculated October 2009. Subject to availability.