WARNING - Don’t use RewardPay/Amex to make a personal SMSF contribution.

[LittleFokker]

I’ve just had all 3 Amex cards suspended, pending account cancellation because I tried to make a payment to my SMSF via reward pay with a business card. They are now treating that as a payment to myself which is against card conditions.

The irony is that I received an advertising email from Amex a couple of weeks ago suggesting I do just this.

Looks like it now triggers alarms (even though I did this 4 times last year). They are now asking for 12 months of BAS statements and 3 months of bank statements.

Of course this had to happen while i’m overseas. And the ato portal is “experiencing difficulties”...
:evil:

 

[Happy Dude]

AmEx want to see your BAS and bank statements? I'd be telling them no. Not even sure that they're entitled to see them, are they?

They might call off the hounds if you provide details of the previous transactions and their recent advert. Then ask them when/why they've changed the T&Cs......

 

[LittleFokker]

They might call off the hounds if you provide details of the previous transactions and their recent advert. Then ask them when/why they've changed the T&Cs......

I huffed and puffed about giving documents but gave in in the end - they called my bluff and told me that the account would be immediately cancelled if I didn’t.

I’ve provided the docs and they are now on the way to the credit department for ”a decision”.

However the key message here is that they confirmed (really emphasised) today that if I ever used reward pay to pay my SMSF again then there would be immediate cancellation. Pretty clear.

I mentioned to Amex that my structure is pretty common, particularly among IT contractors - and asked what’s going to happen with my colleagues (some of whom also do this based on my recommendation) ? Answer - immediate account suspension and review !!

I think the situation is that if your SMSF name includes the name on your Amex account then the system triggers. I know that they did a company search on my SMSF to identify the directors (moi).

I do understand that people with a merchant account sometimes try and game the system by running transactions through to themselves so fair enough that they are hardcore on that.

This however is completely different - they sent the frickin’ email saying “don’t forget to use reward pay and your business card to pay super”.

Anyway, I’m waiting to hear back and get back to normal before I formally complain. I might cross post this to the rewardpay thread.

 

[oz_mark]

I
This however is completely different - they sent the frickin’ email saying “don’t forget to use reward pay and your business card to pay super”.

Presumably they were thinking about paying your employees super, not your own!

 

[LittleFokker]

Presumably they were thinking about paying your employees super, not your own!

I agree, although I am an employee as far as the ATO PAYG and superannuation guarantee goes. I’m irked that there were no problems with the 4 previous transactions last FY.

 

[theblank]

Are these transactions compliant with the Terms and Conditions of the Card/Rewards program?

 

[Pushka]

I huffed and puffed about giving documents but gave in in the end - they called my bluff and told me that the account would be immediately cancelled if I didn’t.

I’ve provided the docs and they are now on the way to the credit department for ”a decision”.

However the key message here is that they confirmed (really emphasised) today that if I ever used reward pay to pay my SMSF again then there would be immediate cancellation. Pretty clear.

I mentioned to Amex that my structure is pretty common, particularly among IT contractors - and asked what’s going to happen with my colleagues (some of whom also do this based on my recommendation) ? Answer - immediate account suspension and review !!

I think the situation is that if your SMSF name includes the name on your Amex account then the system triggers. I know that they did a company search on my SMSF to identify the directors (moi).

I do understand that people with a merchant account sometimes try and game the system by running transactions through to themselves so fair enough that they are hardcore on that.

This however is completely different - they sent the frickin’ email saying “don’t forget to use reward pay and your business card to pay super”.

Anyway, I’m waiting to hear back and get back to normal before I formally complain. I might cross post this to the rewardpay thread.

This. 'For your employees'. Although I suspect if your company is a PTY and you are personally registered with ATO as a PAYG employee and tax deducted every pay and submitted by installment it would be fine.

Presumably they were thinking about paying your employees super, not your own!

 

[LittleFokker]

Are these transactions compliant with the Terms and Conditions of the Card/Rewards program?

For the first time ever I’ve now actually read the T&C’s.

Section 14 Use of the business card:
Prohibited Uses:

“use the Business Credit Card for amounts that do not
represent bona fide sales of goods or services,
e.g. purchases at Merchants that are owned by you
(or your family members) or employees or any other
person contrived for cash flow purposes;”

That’s pretty much what they quoted me on the phone. I’ll raise a formal objection / complaint when I get back from vacation next week. The irony is that the RewardPay promotional email that they sent me suggested that I could improve cash flow by using the service for Super payments.

 

[tizey]

Good for thought: what if you use a clearing house (Cbus/aussuper) to make your company super contributions, of which are directed straight to your SMSF? I can't see how that would trigger anything as your paying the clearing house... I guess you just need to make sure the references show up correctly so the clearing house payment matches up with your transaction.

No way of tracing that I wouldn't have thought

 

[Pushka]

Good for thought: what if you use a clearing house (Cbus/aussuper) to make your company super contributions, of which are directed straight to your SMSF? I can't see how that would trigger anything as your paying the clearing house... I guess you just need to make sure the references show up correctly so the clearing house payment matches up with your transaction.

No way of tracing that I wouldn't have thought

I'd think most wouldn't use the clearing house for smsf but I think you are right in the thinking if you do.

 

[chloe]

Hi All, Just for clarification, you can make SMSF payments through RewardPay, so there should be no issue with Amex. Please email [email protected] and we can help find out what the issue was.

 

[LittleFokker]

Hi All, Just for clarification, you can make SMSF payments through RewardPay, so there should be no issue with Amex. Please email [email protected] and we can help find out what the issue was.

I filled a formal complaint with Amex when I came back from overseas. I received their response last week (> 4 weeks). Their response is:

(a) It's against RewardPay terms and conditions section 18 (and they supplied me with a multipage printout of same)
(b) it's a prohibited Amex transaction and quoted the charge card terms and conditions. (despite me using a credit card)

"use your card to obtain cash from a merchant for a charge recorded as a purchase;

I spoke to my SMSF accountant and they commented that pretty much all SMSF payments could be considered cash.

The end result is that Amex has made my business cards unusable (limit is now $1000 per card) as punishment.

My other questions went unanswered so I'm filing with FOS and ACCC.

 

[chloe]

Hi, If you can provide me with your details via [email protected] I will look into this for you.

 

[QF WP]

Seems to be an issue between RewardPay and Amex, notwithstanding that there may be Amex CC T&C's still to meet. Certainly the RewardPay website shows clearly:





and on the "How it works" page:



and the Case Studies page:

 

[ALH]

While this is hard work for you and I feel your pain, this has given me a new avenue to earn LOADS more points.

 

[LittleFokker]

While this is hard work for you and I feel your pain, this has given me a new avenue to earn LOADS more points.

LOL. I think I'll stick to the Visa1 lurk from now on.

 

[ALH]

I'll have to look. Thank you. It's been a while since I brought myself up to date. I just don't know why it never occurred to me to pay employees Super through Reward Pay

 

[QF WP]

I'll have to look. Thank you. It's been a while since I brought myself up to date. I just don't know why it never occurred to me to pay employees Super through Reward Pay

Was it that you didn't know of it's existence, or that you previously felt that the cost structure was too high for the benefits received in points?

I'll advise that I don't useRewardPay as I see an unnecessary additional cost to my SME for marginal benefits (when I receive enough points elsewhere for consuming items of perceived value).

 

[ALH]

Was it that you didn't know of it's existence, or that you previously felt that the cost structure was too high for the benefits received in points?

I'll advise that I don't useRewardPay as I see an unnecessary additional cost to my SME for marginal benefits (when I receive enough points elsewhere for consuming items of perceived value).

I only just discovered Reward Pay recently. That's my mistake for not looking at these forums often enough. Although, now that I've looked closer, you are right about the surcharge outweighing the value in Points. We earn plenty of points elsewhere..... hic!

 

[moa999]

I suspect Amex doesn't have an issue with Super payments per se, being a legitimate business expense.
But Super payments to self starts crossing into the manufactured spend category (at least in their eyes) - personally don't see it given you can't recycle out of super