How to avoid roaming charges
Roaming charges - what you'll pay to use your phone overseas - vary hugely depending on your provider and your destination.
EU rules cap the amount you can be charged while on holiday in Europe, fixed at 16.5p (€0.19) a minute for inbound calls, 4.3p (€0.05) a minute for outbound calls, 5.1p (€0.06) per text and 17p (€0.20) for each megabyte (MB) of data.
Roaming charges within Europe will be eliminated from June 2017, following an agreement by European authorities to ensure users will pay the same price to use their mobiles abroad as they would at home.
If you're travelling outside Europe there are no restrictions on the rates you can be charged to use your phone, but the EU rules do limit your data charges to around £42 (€50) plus VAT, unless you opt out of the data limits. In practice, this is hardly anything for a smartphone user due to the astronomical roaming charges set by mobile phone providers.
Outside Europe, O2's data charges are £6 per megabyte - equivalent to just a few minutes on YouTube - before you hit the price cap. At this point, you'd have your data services cut off, but opting out of the limit is easily done via a short text - which could well end up being a financially crippling decision. Based on the data usage estimates on O2's website, at £6/MB, you could be charged £3,420 to watch a single film.
O2's pricing is by no means the worst offender, and its standard tariff pricing is broadly in line with other providers.
How to avoid the costs?
The easiest way to avoid being stung by a huge bill is to switch off your phone's data usage when you're away. Wifi access is widely available in most hotels, shopping centres and so on, and by using it wherever available you can avoid a big data bill.
Apps such as O2's TU Go let you make calls and receive texts through your wifi connection and sidestep roaming fees.
Alternatively, most providers offer bundles that mean you’ll pay substantially less than you would under their standard tariffs. The Citizens Advice Bureau says you could pay 80 times more on the standard tariff, compared to the best deal.
While these packages can be better value than the standard charges, they’re still not cheap. Over the course of a two-week holiday, you could find you’re paying £28 to £70 more than your standard bill in extra costs, depending on where you go and your provider.
There’s another risk you need to watch out for too. As mentioned, the EU caps data charges at £42 unless you opt out, and by signing up for these packages you could be doing this implicitly. It’s best to ask your provider about this to make sure you’re not exposing yourself to the risk of a huge bill.
With that in mind, here’s a round-up of the deals offered by the largest UK mobile providers.
Within Europe, O2 offers its travel bundle that gives you a daily 50MB data allowance for £1.99 a day.
Orange offers an unlimited calls and texts package for £2 daily, or 50MB data for £3, also on a daily basis.
EE's Euro Pass bundle is £4 a day, and includes unlimited calls and texts, and a larger 500MB daily allowance.
Vodafone will charge you £3 a day in Europe and £5 a day elsewhere to receive the rates you'd pay at home while roaming. This means you'll pay this on top of any of your usual charges to make calls, send texts or use data.
If you're travelling to Australia, Austria, Denmark, Finland, France, Hong Kong, Indonesia, Israel, Italy, Macau, New Zealand, Norway, Republic of Ireland, Spain, Sri Lanka, Sweden, Switzerland or the US then Three's Feel at Home feature is probably the best deal going.
It allows contract and pay as you go customers to use their normal minutes, texts and data allowance on exactly the same terms as they'd receive in the UK. This is probably the best deal but you'll be restricted to 3G access, meaning if you're using the faster 4G network you'll find your download speeds are slightly slower.
Ernst Doku, mobiles expert at uSwitch.com says: "These tariffs are a first step towards better rates for EE customers abroad, but we're still a way off from wallet (or purse) friendly mobile roaming for all - the abolition of EU charges set to happen in 2017 will do a lot to fix that."
For mobile broadband roaming costs by country, click here.
How much data will I need?
Mobile comparison site Broadband Choices says that browsing the web or Facebook for an hour uses about 10-25MB data. Downloading a music track takes about 4MB, and half an hour of YouTube will eat 175MB. Watch a film at standard definition and you'll use 250MB an hour, or 2,000MB in high definition.
Invented by a Frenchman in 1954 and ironically introduced in the UK on 1 April 1973, VAT is an indirect tax levied on the value added in the production of goods and services, from primary production to final consumption and is paid by the buyer. Its levying is complex, with a number of exemptions and exclusions. For example, in the UK, VAT is payable on chocolate-covered biscuits, but not on chocolate-covered cakes and the non-VAT status of McVitie’s Jaffa Cakes was challenged in a UK court case to determine whether Jaffa Cake was a cake or a biscuit. The judge ruled that the Jaffa Cake is a cake, McVitie’s won the case and VAT is not paid on Jaffa Cakes in the UK.