Jump a few hoops to make £60 a year.
When the bank switching service first came into play back in 2013 I moved over from my ancient Barclays account to the Halifax Reward account.
Over the years the reward has gone up and down, but now offers you a choice of £5, a cinema ticket or two movie rentals each month.
And the latest changes mean you can get three accounts and three lots of the bonus – as long as you jump through a few hoops. Here’s everything you need to know.
What is the Halifax Reward current account?
The Halifax Reward account is a fee-based account that gives you a choice of freebies each month. You can only have three accounts in your name.
You’re charged a monthly fee – but it can be avoided
The Reward account charges a £3 monthly fee, meaning it’ll cost you £36 a year. This isn’t unusual – many current accounts with benefits have a similar charge, including Barclays Blue Rewards, Natwest Reward and Santander 123.
However you won’t pay the fee if you pay in £1,500 every month. Most people should be ok with this if they pay their salary in – you need to earn just under £21,500 a year to take home this amount after tax and National Insurance.
If not you can pay in smaller amount from another account, eg £500, withdraw it, pay it back in, then repeat it once more.
You chose a reward
To be eligible for one of the ‘Reward Extras’ you’ll need to either spend £500 a month on your debit card or keep £5,000 in the account every day of the month.
You also need to pay in the £1,500 a month every month to get your reward (which you should be doing to avoid the fee), and you need to stay in credit.
If you do this you then get to pick a reward. These are:
- Three digital magazines a month from a selection of Hearst magazine titles (eg Good Housekeeping, Red)
- Two HD digital movie rentals from Rakuten (each valid for 35 days)
- One Vue cinema ticket a month (each valid for 12 months)
- £5 a month
The offer you choose is fixed for a year, so you can’t mix and match throughout the year. You can choose a new reward at the start of each 12 month anniversary.
It’s possible to track the progress towards your reward in the app so you know if you’re going to get it or not each month. You’ll also find when your 12 months is due to end and then choose your new reward (if you want to change it).
Extra cashback offers
You can activate offers from a handful of retailers to earn cashback if spending with your Halifax card. I’ve hardly ever used it, but I check from time to time to see which shops are on there, just in case.
Switching bonus
Halifax tends to run a switching deal two or three times a year, usually offering between £100 and £175. Get details of how it works, and any future promotions, in my Halifax switching offer analysis article.
Account summary
| Benefits | Choice of £5 a month / Vue cinema ticket / 2 Rakuten HD rentals / 3 digital magazine subscriptions |
| Save the Change auto-savings feature | |
| Limited cashback with retailers via debit card | |
| Fee | £3 (£0 if you pay in £1,500 every month) |
| Requirements | Pay in £1,500 every calendar month |
| Either spend £500 on your debit card each month or keep £5,000 or above in the account all month | |
| Stay in credit (above £0) all month | |
| Multiple accounts? | Three |
| Exclusions | Your chosen Reward and qualifying method are fixed for 12 months |
Are the rewards any good?
I’ll look at each benefit in turn:
£5 monthly reward
£5 a month profit is better than similar rewards on offer elsewhere – as long as you are avoiding that monthly fee. That adds up to £60 over the year, which although that’s probably a lower value than the other options, you have the freedom to spend it how you wish.
The money is paid into your account each month. It’s worth noting that if you are a higher rate taxpayer you’ll be liable to pay extra tax on this bonus.
Free cinema ticket
The code you’ll get each month is valid for a year, and you can use two or more at the same time – saving on a family trip. They can also be used for pricier 3D screenings or VIP seats too, increasing the value.
Standard Vue cinema ticket prices can vary between a fiver through to well over a tenner, and even more for the posh seats – it all depends on where you live.
If you’re paying close to a fiver, you’re better off getting the cash option – that’ll give you the flexibility to go to different cinemas (or not go at all).
But if you have an expensive Vue cinema near you and go once a month then the value could be pretty decent. Say your tickets are £10 that’s an annual reward worth £120. If VIP tickets are £18 it’s worth £216.
Even so it’s possible to save on cinema tickets in lots of different ways, and those deals could work out as a better option. For example two-for-one tickets via Meerkat Movies or free Vue tickets via a Telegraph trial. Here’s my guide to the best ways to save at the cinema.
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Digital movie rentals
The vouchers can be used on SD and HD films on streaming site Rakuten. You can’t use it on titles costing £5.49 or more, which rules out ‘Home Premieres’ and UHD. Having a quick look showed some SH and HD films are priced at £5.49 so it’s unclear if these are excluded.
Assuming an average £5 price, you’ll be getting the equivalent of £10 back from your account. That means it’s got a value of £120 a year.
I think that makes this a decent offer if you regularly watch two new release HD movies a month. However, with more films going straight to streaming services (eg Disney+ or Netflix), you might struggle to find 24 films a year you want to rent – especially if you sometimes go to the cinema too.
It’s worth remembering too that you can also often get free or cheap rentals from time to time in other ways (which I’ll share here). For example, Amazon often runs £1.99 rentals for Prime customers, while Chili has 99p selections.
The vouchers are valid for 35 days, and once you choose your film you’ve 48 hours to watch your film.
Free magazines
You can choose your three titles from this selection:
- Cosmopolitan
- Country Living
- ELLE
- ELLE Decoration
- Esquire
- Good Housekeeping
- Harper’s Bazaar
- House Beautiful
- Men’s Health
- Prima
- Red
- Runner’s World
- Women’s Health
Your picks will be digital-only, so you’ll need a tablet or computer to read them. It looks like the three magazines you choose at the start of the year will be the same ones you’ll get all year.
Personally I’d check first what magazines you can get for free from your local library.
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Spend or save: Which is best?
So you could be making anything from £60 a year (taking £5 a month) through to £200 (for top end Vue tickets) from this account. But you need to factor in the requirement that you either need to spend or save a lot of money each month with Halifax. Here’s my take on each option.
Have £5,000 in savings
The option of £5,000 a month in your account seems relatively simple. Do this every month for a year and the £60 cash reward is the same return as putting that money in a 1.2% savings account. Even with rate cuts improving most months, that’s actually quite healthy in comparison to others.
But I’m not a fan of this method. For a start that money has to stay there every single day of the month. So whether you need to use it, or the balance accidentally dips after a large purchase, you don’t get the reward.
More importantly, right now you can get a much better rate elsewhere. So you’ll earn a higher rate, be able to earn it on more cash, and have the flexibility to take money out as and when you need it.
Spending £500 via the debit card
The alternative is to spend £500 a month on your debit card. Do this exactly and you’ll earn £60 a year (if you take the cash option). That’s the equivalent of 1% cashback – so no real difference to using the top cashback cards.
However if you spend more than £500 you won’t earn any extra money, reducing your equivalent rate. So do you just spend £500 and stop, then move over to your alternative card?
Well, no as there are a couple of workarounds here that allow you to effectively earn double cashback on that £500 monthly spend.
Very simply, if you have a cashback credit card, you use your Halifax debit card to pay £500 off the bill every month. I’ve done this for the last year now and it works – you’ve just got to remember to do this before your direct debit for your card goes out of your account. I actually moved my Amex payment date from the start of the month to the middle to give me a bit more leeway.
Or, you can add money to a Revolut current account. These app-only bank accounts both have the option to do this via debit card, so choose this rather than a standard bank transfer.
Once you’ve paid the money you can transfer it out of Revolut back to Halifax (or any other bank). This is a useful option if you spend with the Chase debit card rather than a cashback credit card.
The app
I actually quite like the Halifax app as you can do pretty much everything on there without needing to log on via a desktop. Some of the key features:
Sharing bank details
You can send your sort code and account number via the app. There’s no option to copy these in the app, so you’ll need to share them to another app (eg notes or messages) and copy there.
Card controls
All the main options are here:
- View PIN and request new one
- View and copy card details
- Freeze card use abroad, online and / or in-person
- Stop gambling payments
- Set your own contactless limit
Alerts
You can get notifications for:
- Debit card transactions
- Weekly spending summaries
- Money paid in and out
Sending and adding money
It’s easy to transfer cash to new and existing payees, and there’s no need for a card reader. You can scan a cheque using the app to add the cash to your account.
Insights and budgeting
There’s an easy-to-find option to see all your upcoming payments in one place, how much they add up to and when they’ll be paid. You can also manage and cancel subscriptions in the app – the ones paid via a debit card rather than standing order or Direct Debit.
You can look at monthly trends and payments which is potentially handy, but not as good as those on offer from third-party apps like Money Dashboard and Snoop.
Tapping on a transaction will show on a map where it took place.
There’s a decent seven years of transaction history on the app, which you can also search. It’s possible to export monthly statements from when you opened the account but only as PDFs.
Other features
You can also:
- Use Face or Touch ID
- Change personal details
- Add accounts from other banks via Open Banking (just the major high street banks)
- See your credit score from TransUnion (which you can do for free anyway)
What’s missing
However, when compared to the likes of Starling and Monzo, the big absence is the lack of separate pots or spaces. All your money is together in the main account.
Summary: Should you get it?
Andy’s Analysis
If you have £5k to save or already use a cashback card for spending, then the £5 reward isn’t better than what you can get elsewhere.
But thanks to the debit card hack, I think it’s well worth getting one of these accounts to claim the reward alongside your other cashback card. And then another two times with additional accounts.
Plus the app is actually really decent and does most things you’ll need. So all in this is a good account to have and perhaps even use as your main account.
Looks like NS&I £500 debit card workaround has been closed, I notice it’s not mentioned on the article but was referred to on previous YouTube video Andy did on the subject. Last month it counted but March it has not qualified me for the £5 cashback. Will pay £500 off a credit card balance instead by debit card instead so I don’t miss out.
There have been delays on tracking rewards at Halifax so it could be it appears in a few days
Are you sure topping up Monese with £500 will trigger the £5 bonus? I’ve tried this in the past and it didn’t qualify in the “track your rewards” section of the app.
Also why do higher rate tax payers pay tax on the £5, surely it just counts towards their £500 tax free allowance.
Yeah I had the same concern topping up with Revolut. And can confirm at month end that these did not count towards the £500 spend. And thus sadly did not qualify for the £5 bonus on both reward accounts…And yes, definitely followed the instructions and paid using the debit card option.
The reward isn’t classed as interest by HMRC but as other investment income and so outside the scope of the savings allowance. The banks don’t openly broadcast status on these type of rewards arrangements.
Does anyone else keep having their payment declined to revolut or just me?
Even after calling their fraud prevention team it isn’t working. I’m wondering if they’re now trying to prevent this trick.
Hi Andy,
Just wanted to ask how opening the extra reward account went? I currently opened a 2nd one this week and is already showing ‘track rewards’ which I thought was a bit strange as it’s not quite November yet! Have you found it works?
Yep; so far it’s working, will do a full update next month
Hi,can I switch from Lloyds bank to Halifax and get the incentive because I have not long ago had an incentive from Lloyds.
Yep!
Trick I haven’t seen mentioned, is to Pay £500 into a savings account by DD. You can, of course, take the £500 out again once it’s gone through. The advantage of this over the credit card ruse, is that you don’t have to spend £500 a month, in fact you don’t have to spend anything at all in reality. Accounts that I know of available for the trick are NS and I and YBS. I use YBS and it works a treat, no questions asked, guv.
Sorry, error on my part, but the trick works. You can pay into a savings account with NS and I or YBS from your Halifax Reward current account by debit card. I inadvertently said DD, which wouldn’t qualify. You can do this online. I’ve been using the method for many months and get the £5 regularly.
Pay into NS and I or YBS by debit card, not DD.
Does Revolut consider the Halifax Rewards Debit Card a credit card for anyone else? For some reason they consider it as a credit card for me and they no longer allow top ups with credit cards as of 08/07/2022. I’ll probably open a Monese account instead and see if I can achieve the £500 spend with Monese instead.
I’ve tried it with Monses and it didn’t qualify in “Track my Rewards” despite what the article claims. Happy to be proved wrong.
The £5 reward option, given 1.5%+ you can now get on savings, isn’t a great deal if you’re doing the £5k option…only works out at 1.2% interest. So probably better to pick one of the gift rewards or just spend £500 a month for a better return.
Hi Andy,
Does the Revolut trick still work as of March 2022?
Yep!
Hi Andy, would a £500 a month Direct Debit to Vanguard qualify for the £500 Debit Card spend requirement?
Hi Tom, no a Direct Debit isn’t valid (whoever it is to). It has to be a debit card payment.
Hi Andy. I have Monzo and Halifax account. Will bank transfer from Halifax to Monzo of £500 via the App, can be considered as a spending from the debit card and I would get £5 reward? Cheers
No, Monzo requires a bank transfer. You need to enter the long card details from your debit card for it to be a debit card transaction
So let’s say I’m not going to have the full £1500 getting paid in this month. Is there I can get it by moving my own money around? Like bank transfer or would it have to be paid in to the account in cash over the counter or another way?? Thanks
Yes, absolutely. You can do a bank transfer in smaller amounts. So you could pay in £500, withdraw it to another account. Pay it back into Halifax, withdraw it again. And then pay it in again for a final time. That’s your £1,500 sorted for the month.
Hi Andy, I am considering switching to the Halifax Rewards Account but I just need clarification on your comments about topping up a Monese/Revolut account with a debit card payment. Can you do this as I think moving money to another bank account is classed as a money transfer which doesn’t count for the Rewards Extras offers?
It works! You’re using your debit card to top up the other accounts rather than a bank transfer to the sort code/account number
Hmm – I have just switched from my old Santander 123 account since they kept on reducing the interest, then increasing the fees and finally changed which direct debit bill payments received the various 1, 2 and 3% cashback so in the end it just wasn’t worth it!
Anyway – Halifax have already decided that I WILL NOT get the £5 reward for my first month because “I did not keep a £5000 balance every day”.
Well – that is only because THEY created the account the next day after I started the “switch account” process, and put the £100 switching bonus in, but then did not switch my account for 7 days, so for the first 6 days it only had the £100 switching bonus in – i.e. the balance is less than £5000.
I know it’s only a fiver, but it does seem a bit unfair that they started counting the days BEFORE they switched the account!
That’s ridiculous. I’d definitely complain.
Andy i didnt get my fiver halifax even though it came out of my account on the 28th on may and cleared on the 29th of may by American express halifax said 1st of july so didnt get it that month
Hi – I am thinking of doing this. I do already have a Halifax current account which my wage / pension is paid into. Would I be able to transfer from the current account into the new reward account to help meet some of the 1500 critea? Or does the £1500 pay in need to be from a different bank? Thanks
I am a bit confused, I used to have the Halifax Reward account , I still have the account but only have one DD going out and is now just called current account. I changed my main account and DDs to Santander when the interest was good. Will I need to change my DDs back to Halifax to get the £5 reward?
I wanted to take advantage of this neat hack so I got three accounts. I managed to trigger the rewards in the first month no problem, but when I tried this in the second month, the fraud team flagged the payments (I was making a debit payment to Revolut).
Anybody else run into this issue?
The customer service team were amazing and got it resolved very quickly, but is there any way to avoid getting flagged this way?
Andy,
If I put (for example) 5K in the account to leave in there, and then at the beginning of each month transfer £1,500 in, and then transfer it back out to where it came from at the middle of month, would I still qualify for the £5 per month reward? £60 per year is as good as I could get risk free from 6,500. I think ?
Hi Robert. As long as the balance is always above £5,000 you’ll be fine to get the £5 reward. Personally I’ve gone with the £500 on debit card option each month as it gives me more flexibility. Then you could put the £5,000 elsewhere even at a lower rate and get money on top.
I have the account. You can pay the £1500 in and transfer out on the same day. Andy’s blog is out of date. You won’t get anywhere near 1.2% elsewhere now
True, but it’s better to get the same rewards via the £500 debit card spend AND put £5,000 in a different savings account, even though the rate will likley be less than 1.2%.
Hi Andy,
I’m going to go for the £500 monthly spend by debit card. I have a Monese account which can be topped by you guessed it? £500 monthly with a debit card.
I’m assuming this method will count as £500 payment as it has done with my TSB spend and save account
(30 payments monthly) by debit card in order to get £5.00 card reward, but only for the first 6 months.
So the debit card payment to clear Amex or a credit card needs to be done manually?
Isn’t this a pain as I imagine your DD still collects so the credit card/amex ends up in credit?
Hi Nick, as long as you do this before the DD comes out it should be adjusted. You might need to do this a week in advance or so for that to happen – each CC company does this differently
Hi
I’m annoyed with myself for choosing the two digital films as my reward, the choice is really poor, basically straight to video quality
I agree with your assessment that the best choice is £5 but for the life of me I can’t find any info on how to change your regard extra – can you help please??
I don’t want to be stuck with you original bad choice!!
Thanks
Hello Andy!
Thank you for your article, it is very insightful! I am new to switching banks and I wanted to ask you some questions, if that’s okay. Should I receive my salary into the acound as it is at around £1500, will I get taxed if I end up spending it as the month goes on? Also would I have to alredy have that £1500 amount in the old bank account in order to make the switch and receive the £100 reward?
I am little bit confused as to whether a Rewards account can be used for the simple purpose of receiving your salary and day to day spendings. Thank you in advance!
Hi Andreea
No problem at all! Yes it’s absolutely fine for having your salary paid in each month and then spend with it.
There’s no need to have any money at all in the old account before the switch, it’s simply to avoid the fee each month.
Hope that helps!
Andy
Can you still earn £5 reward and get no fee on the account if you have 5k balance, then put an extra 1.5k in and take it (1.5k) out straight away?
Hi Jason. Yes as long as the balance doesn’t fall below £5k then you’ll get the £5
Hello, does anybody know if the first £500 paid using the debit card has to be paid in June or July 2020. By this I mean is the reward paid retrospectively?
I made enquireies regarding the new Halifax reward account at my nearest Halifax bank,and was told to receive the £5 reward loyalty bonus I would have to pay in £5000 pluse £1500 per month pluse £500 per month on my debit card. I’m not too pleased about the £500 per month on my debit card
Hi Brian,
That’s incorrect. You do not need to keep a balance of £5k AND spend £500. It’s one or the other. Their official documentation states clearly:
“Under the current offers, you can choose to earn a monthly reward by either:
• Spending £500 or more using your debit card in a month; or
• Keeping £5,000 or more in your account every day for a month.”
Sounds like the staff hadn’t a clue what they were talking about.
Hi Andy,
Yes thanks I’ve seen that somewhere in the past. It does seem that since (2016) the changes to interest where banks don’t deduct tax on interest at source (the £1,000 allowance at 20% taxpayer and £500 allowance at 40% taxpayer) there are further issues.
Apparently rewards do not seem to be covered by the bank interest allowances being classed as annual payments (fully taxable) not bank interest it seems banks pay the 20% tax (to continue?) on a gross value and leave you with the residue as the reward, hence higher rate taxpayers could be liable for more. An exception to this is where a reward is paid on accounts that charge a fee like Barclays Blue, the payment is called a miscellaneous one which is not treated the same as an annual payment so is fully taxable so of considerably less benefit.
There is something on MSE from around 2016 on it see:
https://www.moneysavingexpert.com/news/2016/07/halifax-barclays-or-co-op-bank-customer-you-may-need-to-pay-tax-on-your-rewards/
I’ve not been able to establish (the girl didn’t seem to know when I called to sort the new deal out) whether the two direct debits are still required as there is no mention of that in the new reward terms letter so I suspect not(?)
So it is more complicated that I thought it would be, cash rewards potentially not being as good as they initially seem compared to interest bearing accounts as the latter fall into ones personal interest allowances whilst the rewards do not. Higher rate tax payers carrying additional liabilities even if they have only used a tenners worth of their annual £500 interest allowance in a tax year.
I guess as the amounts are likely to be relatively small it seems HMRC doesn’t actually require separate tax returns to be completed for this if a higher rate tax payer as presumably the admin for collection would outstrip the recovery, but if one has to complete a self assessment it should be included, I suppose as HMRC has to do the admin anyway on the return so it isn’t extra work for them.
It would be quite funny if every PAYE higher rate tax payer with one job and an occupational pension getting annual interest under their £500 allowance sent in a self assessment for the £60 a year (at £5 a month reward they should pay another 20% tax on) result being flooding HMRC with loads of extra administration for the princely sum of an extra £12 a year tax recovery per person:)
Cheers
Mark
Just went through the Halifax procedure chose the £5 a month I can meet the £1,500 pay in a month simply by rotating money between accounts £1,500 into Lloyds Club to get their interest and then to Halifax now keep a few quid in Halifax to stay in credit. The good part about this is the £500 on the debit card can be paid into council tax online American Express isn’t accepted, it can also be used in other places Amex isn’t accepted, failing that credit card balances can be paid online so the £500 a month should easily be achievable. One other thing is I don’t think the reward is taxable now similar to Topcashback and things like that as it isn’t termed interest but a marketing reward incentive/ discount etc, much the same as we don’t pay tax on the difference between a reduced item and the normal full price in a shop. I think when it started off in 2013 it was in place of interest but it has now morphed into a different account all together. Thanks Mark
Cheers Mark, interesting thought about using it to pay credit card balances. In the small print I found details where the £5 reward is actually a £6.25 reward that’s taxed at 20% hence the warning that 40% rate taxpayers should probably declare the reward.
2 questions
1- does your direct debit payments count to your £500 monthly target?
2- will i get my £2 reward if i go to fee free account on june 1st for the month before?
Hey Toby, it’s debit card payments only, and cash withdrawals don’t count. And sadly the free account has no Reward at all.
Does direct debits count in the £500 spent each month
No, unfortunately, it needs to be a purchase with the card
Would it work if I topped up my Monzo/Revolut/Starling with a debit card? They all offer the option to do so and I’d assume they work the same way as credit card payments?
Hi I’m on ultimate reward and I have a big overdraft hoping to have it paid off by July will them changing me to a current account affect my overdraft and any of my direct debits
Hi Phil, It won’t affect your direct debits and it shouldn’t impact your overdraft either but it’s worth checking direct with the bank. If they haven’t already done this automatically then ask them to give you £500 interest-free on that overdraft. It’s a short term measure during lockdown just for a few months.
Yep Andy way back in March I floated paying credit cards off for the £500 requirement it works did it last month at the beginning of the month and did it a few days ago that satisfies the requirement for £500 spend Cheers Mark
Thanks Mark, so you did!
I had a Halifax account years ago, as a small child. I’m now going to see if I can get another one, im currently with Lloyd’s but my card has been cloned 7 times this year. Its driving me crazy.
Thank for all the input x
That’s awful your card has been cloned! Any idea how?