Redeem American Airlines Miles: Part 5 — Taxes, Fees, Fuel Surcharges

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I am updating and re-posting this series on redeeming American Airlines miles in light of the fact that right now it’s super easy to earn 146,000 American Airlines miles.

For a limited time, the Citi /AAdvantage Platinum Select MasterCard and the CitiBusiness / AAdvantage Platinum Select World MasterCard are both offering 50k bonus miles for spending $3,000 on each card within three months of opening it. The new Barclaycard AAdvantage Aviator Red World Elite MasterCard is offering 40k bonus American Airlines miles after just one purchase and paying the annual fee of $95. You can sign up for all three in the same nine day period (you can be approved for no more than one Citi card in an eight day period) and earn at least 146k American Airlines miles within three months after meeting the bonus requirements. 

Credit card links have been removed from posts and added to the menu bar at the top of every page of MileValue under the heading Top Travel Credit Cards.

“Redeeming American Airlines Miles” Series Index

Let’s talk about the out-of-pocket cash costs associated with American Airlines awards: the taxes, fees, and fuel surcharges. How much are taxes, fees, and fuel surcharges on American Airlines awards? This is part five in a series that will allow you to master redeeming American Airlines miles.

Taxes

All award tickets, using all types of miles, require you to pay the government taxes associated with your ticket. These are $5.60 per one way on domestic tickets and a lot more on international tickets, ranging from $50 to $300 roundtrip.

Premium cabin awards that originate in the United Kingdom are the most expensive. Avoid those, and you’ll usually book roundtrip awards with taxes around $100 (see List of Award Taxes from Major Cities in Europe so you can plan a return from a low tax country).

If the award search is not possible on aa.com, and you will book by phone (800-882-8880), the easiest way to estimate the taxes you’ll pay on an American Airlines award is to search a similar award on united.com. International taxes are determined by the countries and airports you use, so whatever united.com says the taxes would be on a similar award is what you’ll pay in taxes on your American Airlines award.

Fuel Surcharges

American Airlines only collects fuel surcharges on award flights operated by British Airways and Iberia.

British Airways’ fuel surcharges are outrageous. From New York to London on British Airways flights, American Airlines collects fuel surcharges of $259 one way in economy and $414 one way in Business or First Class. These are in addition to the taxes on the award. Fuel surcharges are actually a lot lower heading from London to New York at $181 one way in Business Class, but taxes are so high leaving London in a premium cabin (see above) that you will still pay around $450 out of pocket for a one way award.

American Airlines does not collect fuel surcharges on British Airways intra-Europe flights.

On British Airways flights to other regions, fuel surcharges vary. You can look them up on aa.com, since aa.com displays British Airways award space and breaks down the cash component of awards between taxes and “carrier-imposed fees,” a euphemism for fuel surcharges.

Breakdown of taxes and fuel surcharges on a Business Class award NYC > LON
Breakdown of taxes and fuel surcharges on a Business Class award NYC > LON

The fuel surcharges that American Airlines collects on Iberia are much smaller. I priced out roundtrips in economy and Business Class from New York to Madrid on Iberia with American Airlines miles.

  • Economy had combined taxes plus fuel surcharges of $177 roundtrip.
  • Business had combined taxes plus fuel surcharges of $198 roundtrip.

Taxes on a roundtrip award of direct flights between New York and Madrid are $51 on united.com. That means fuel surcharges are $126 roundtrip in economy and $147 roundtrip in Business Class on Iberia between the United States and Europe.

American Airlines doesn’t collect fuel surcharges on any other airline for award tickets.

Fees

In addition to taxes and fuel surcharges, you may be subjected to fees.

  • $40 to book an award by phone if it can be booked online. This is WAIVED when you cannot book the award online, but make sure the agent remembers to waive it. This is also waived for Executive Platinum elites.
  • $75 to book an award within 21 days of departure. Waived for elites.
  • $75 to change departure date to a date less than 21 days away. Waived for elites.
  • No fee to change the date of an award more than 21 days in advance.
  • No fee to “upgrade” an award to a better cabin than the one in which you initially booked the award more than 21 days in advance.
  • $150 to cancel an award, to change the type of award (e.g. AAnytime to MileSAAver or AA-only to partner), or to change the origin or destination of the award. For additional awards changed/canceled at the same time, you pay only $25 per award, so a couple canceling their award would pay only $175 total. Waived for Executive Platinum elites.

Bottom Line

For a limited time, the Citi /AAdvantage Platinum Select MasterCard is offering 50,000 bonus American Airlines miles after spending $3,000 in the first three months. The CitiBusiness / AAdvantage Platinum Select World MasterCard is offering the same bonus. The Barclaycard AAdvantage Aviator Red World Elite MasterCard is offering 40k bonus American Airlines miles after just one purchase and paying the annual fee of $95.

By meeting the $6,000 total spending requirement + putting one purchase on the Barclaycard and paying its $95 annual fee, you’ll earn at least 146,000 American Airlines miles. If you decide to open all three cards, open the Barclaycard first, then either Citi card, and then wait eight days to apply for the second Citi card. For example, on day 1 you apply for the Barclaycard and then immediately following, the personal Citi card. On day 9 you apply for the CitiBusiness card.

Credit card links have been removed from posts and added to the menu bar at the top of every page of MileValue under the heading Top Travel Credit Cards.

When redeeming these miles, you are on the hook for taxes, fuel surcharges and fees. Minimize all three by booking at least 22 days before departure, avoiding British Airways and Iberia, and not flying home from Great Britain.


Editorial Disclaimer: The editorial content is not provided or commissioned by the credit card issuers. Opinions expressed here are author’s alone, not those of the credit card issuers, and have not been reviewed, approved or otherwise endorsed by the credit card issuers.

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31 COMMENTS

  1. If I booked an award ticket in March of 2014 for October 2014, and cancelled it, I know I have 365 days from issue to use it? If the period of travel is within 21 days, will I get hit with a $75 fee per ticket on it? Thanks.

    • If you cancel it, you get the miles back and the ticket is gone. The cancellation fee is just $150 no matter if within 21 days or not.

  2. I was unclear. I was unable to make the flight in October, so I postponed the ticket. I have not rebooked it yet, but I have until the end of March. They said I didn’t qualify for a return of miles since it was a free one way. If I rebook for January 31st now, I will have the pay the within 21 day $75 dollar fee?

  3. There’s gotta be a trick that someone isn’t sharing for awards flights to London. BA has great availability, but those fees are ridiculous. Its hard to find award flights on AA metal. Thats why it seems like AA miles to Europe are almost worthless, as 90% of flights connect in London. Middle east and Asia though are great!

  4. Regarding change fees, what are the rules for change of return flights (outbound travel already completed) only on a roundtrip reservation? If new departure date for return flight is more than 21 days out, will there be no change fee?

  5. You wrote, “American Airlines does not collect fuel surcharges on British Airways intra-Europe flights.” What about intra-Europe on Iberia, such as Barcelona to Madrid or Madrid to Paris?

  6. I had $139 in charges on AA Business Class Award ticket, including a $40 “carrier imposed fee” which I assumed was for the British airways intra-Europe leg. This is the itinerary: SFO –> ORD on AA 197, ORD –> LHR on AA 98, LCY –> FLR on BA 3279, with about a 22 hour layover on each stop. Any idea why I was charged that? Should I complain? The ticket initially priced out at 95K, and I had to call in to get them to correct it to 50K. Maybe the fuel surcharge was also charged erroneously.

    • My guess is you got hit with the $40 phone fee since all those airlines are bookable online. You should have made sure that was waived at the time of ticketing because of the price error. Not sure what you can do about it now.

  7. Found this Flyertalk thread on the subject:
    http://www.flyertalk.com/forum/american-airlines-aadvantage/1674670-taxes-charges-aa-awards-connecting-through-lhr.html
    Apparently, it is true that BA has eliminated Fuel Surcharges on an intra-Europe flight. However, you will pay the UK APD on a flight that begins in UK to Europe. If you only transit the UK (less than 24 hrs), the APD is eliminated but AA does add a YQ charge, even though BA doesn’t charge for it. Once they add that charge, the US adds additional taxes that aren’t paid if the flight ends in the UK (Transportation Tax and Passenger Facility Charge). Bottom line is that it gets expensive to add that segment onto an award ticket from the US.

  8. As another data point, I just booked one-way MAD-JFK in business using AA miles on Iberia yesterday, $116 total taxes and fees.

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