EE to refund customers overcharged abroad

Billed them for VAT by mistake

portrait of young man arguing...

Thousands of EE customers are set for refunds totalling more than £1m, after the operator admitted that it had wrongly charged them VAT on top of the standard data roaming charges.

The refund will go to customers who used data in a non-EU country between October 2012 and October 2014. The company wrongly charged these customers VAT on the data they used, passing the money straight on to the taxman.

But it has now managed to reclaim the money from HMRC, and says it will repay customers by crediting their accounts with amounts ranging from about £2 to £80. In total, the compensation is expected to be as much as £1 million.

Affected customers should already have received a text message from EE explaining the situation and telling them how much of a refund to expect. Former customers who believe they may hasve been affected have been told to contact customer services.

Customers of Orange and T-Mobile - which merged to form EE - are believed not to have been affected by the charge.

"Due to a configuration error in our billing system, made following a system change, a small number of customers were wrongly charged VAT on the Data Roaming bundle outside of Europe," the company has explained in a statement.

"This was a mistake, and we are now refunding these charges and contacting affected customers to apologise for the error."

The BBC says the mistake, which is believed to affect as many as 140,000 people, was only spotted after a customer complained.

Last summer, new EU regulations came into effect, restricting costs for data roaming in the EU. The maximum charge for making a call is now 19c a minute excluding VAT, while sending a text should cost no more than 6c and downloading 20MB no more than than 20c.

However, according to Which?, many customers don't realise that the reduction only applies to EU countries - meaning that shock bills are still turning up.

EE is the UK's largest network provider, with 27 million customers - over a third of the total mobile market in the UK. It's currently in talks with BT, believed to be in their final stages, about the possibility of a £12.5 billion takeover.

Most customers won't have been aware of the overcharging, meaning that the refund will come as a pleasant surprise. It may sweeten the pill for customers disappointed that EE has recently halted its 'Orange Wednesdays' offer of two cinema tickets for the price of one and its Pizza Express offer, promising new customer perks instead.

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