Help me escape my tourist tax trap

We went on holiday to Canada and, as non-residents, were entitled to claim back the purchase tax on items we bought there.

We claimed through a private agency called International Tax Refund Services (ITRS) and a cheque finally arrived nine months late. It was drawn on the Canadian Bank of Nova Scotia but written in US dollars. We received $US71.41, about £48.

Our bank, Yorkshire Bank, initially said it would cost £4 to process but later would not accept the cheque because 'it wouldn't be worth it'. It sent back the cheque without any note or letter but franked six times on both sides with the bank's stamp.
JY, Leeds

Yorkshire Bank denies refusing to cash your cheque. It wanted you to understand that the charges by both banks, around £42, to convert US dollars from a Canadian bank, would almost wipe out the value of your refund.

Yorkshire's best suggestion is that you ask ITRS to send you another cheque, this time written in Canadian dollars, which costs £4 to convert to sterling. Given the length of time ITRS took to send the first cheque, this may be a hopeless request, but Yorkshire Bank says that now your receipts have been processed, it is easy for ITRS to write another cheque.

Let me know the outcome because, if you fail, Yorkshire Bank has offered to reduce its charges but warns that this will make little difference as Bank of Nova Scotia will still charge.

The Canadian Embassy in London says there is no need to pay a private agent to handle tax refund claims, as you can claim direct. The government takes around three months to process claims and issues open-ended cheques so you can keep the cheque to spend next time you visit Canada, avoiding conversion costs.

Travellers can pick up claim forms in tourist information centres or at the Canadian customs desk at airports. Your purchases must be available for inspection, so do it before checking your luggage through.

Isa confusion: Rules apply

My daughter opened a mini-cash Isa with HSBC in March 2000 for £3,000. This year she tried to transfer £1,000 from her current account to a new Isa but was refused.

Inquiries to head office came up with the bizarre explanation that, because she had not paid any money into her Isa during the 2000-2001 tax year, she would have to close the account and complete a new application form to open a new Isa. Apparently this is Inland Revenue regulations.
PW, Hull

The Inland Revenue says an Isa application is valid for the tax year in which it is made and for subsequent years if you stay with the same provider, to avoid the hassle of making new applications each year. But if you miss out one year, the application is no longer valid and you must complete a new application form. HSBC does not have to close the original Isa, although combining the money in one new account is simpler and, with HSBC, earns a higher rate of interest on balances over £6,000.

Tesco credit: Penny-pinching

In January I closed my credit card account with Tesco but in March £18.06 appeared on a statement and Tesco has been unable to inform me what this money is for. Its collections department is now chasing me for payment. I am refusing to pay until Tesco tells me how this money could have been spent when my account was closed.
JS, Leicester

All your worry has been caused by a 4p clerical error. When you closed your account, Tesco sent a cheque to repay your credit balance but by mistake sent £18.02, leaving 4p outstanding. When balancing the books, the staff looked for an £18.06 debit and, failing to find it, debited your account again. The second debit was for the right amount but, as £18.02 had already been taken out of your account, you appeared in debt and Tesco sent you a statement. Tesco admits it is in the wrong and, having made a mistake, should have responded to your calls sooner. It is sending you £30 of Tesco vouchers to apologise for the mess.

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