UK holiday refund claim 2026: Section 75, chargeback and package holiday rights

Chandraketu Tripathi

Finance Editor, Kaeltripton

Published 10 May 2026

Last reviewed 10 May 2026

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TL;DR

If a holiday is cancelled or significantly changed, you may have rights under: Section 75 of the Consumer Credit Act (credit card purchases over £100); chargeback (debit or credit card refunds for services not received); ATOL protection for ATOL-bonded package holidays if the operator collapses; and the Package Travel Regulations 2018 for package holidays. Always try the provider first, then your card issuer, then the relevant alternative dispute resolution scheme.

Holiday cancellations and significant changes to travel arrangements are among the most common consumer disputes in the UK. The rights available to you depend on how you booked, what happened, and which legal framework applies. Understanding which of the available routes - Section 75, chargeback, ATOL protection, or the Package Travel Regulations - applies to your situation is essential before deciding how to pursue a refund.

The Package Travel and Linked Travel Arrangements Regulations 2018, which replaced the previous 1992 Package Travel Regulations, provide the strongest protection for package holidays booked with UK operators. However, many travellers book components separately - flights on one site, hotels on another - which means they do not benefit from package holiday protection and must rely on the individual terms of each booking, Section 75, or chargeback. This guide covers all the main routes to a holiday refund and when each applies.

Key facts (2026)

Section 75 of the Consumer Credit Act 1974 makes a credit card issuer jointly liable with a supplier for breach of contract or misrepresentation on purchases between £100 and £30,000 made directly on the card (legislation.gov.uk).
Chargeback is a card scheme (Visa/Mastercard) voluntary process available on debit and credit cards for services not received; no statutory minimum purchase applies but the claim must typically be submitted within 120 days of the transaction (individual card scheme rules).
ATOL protection: the Air Travel Organiser's Licence scheme protects customers of ATOL-bonded holiday companies if the company collapses; check whether your operator holds ATOL at caa.co.uk (Civil Aviation Authority).
Package Travel Regulations 2018: package holiday operators must provide a full refund within 14 days if they cancel a package. Travellers can cancel without penalty if there are unavoidable and extraordinary circumstances at the destination (gov.uk / legislation.gov.uk).
UK261 (successor to EU261): passengers on UK flights are entitled to compensation of £220-£520 for cancellations and significant delays of three hours or more, depending on distance, where the airline is responsible (UK-SPEC261, Civil Aviation Authority).

Section 75 of the Consumer Credit Act

Section 75 of the Consumer Credit Act 1974 provides one of the most powerful consumer protections available in the UK. When you use a credit card to pay for goods or services where the purchase price (per item or contract) is between £100 and £30,000, your credit card issuer is jointly and severally liable with the supplier for any breach of contract or misrepresentation. This means that if the supplier fails to deliver - for example, if a holiday company collapses or cancels your holiday and refuses to refund - you can claim the full refund from your credit card company instead, without needing to recover from the supplier directly. Section 75 applies only to credit cards (not debit cards) and only where the payment was made directly to the supplier on the card; payments through PayPal or other intermediaries may not attract Section 75 protection. Contact your card issuer in writing, citing Section 75, and provide evidence of the breach (booking confirmation, cancellation notice, and any refused refund communication).

Chargeback for debit and credit card payments

Chargeback is a separate process operated by the card schemes (Visa, Mastercard, Amex) that allows cardholders to dispute a transaction and request that the card issuer reverses it where goods or services were not received. Unlike Section 75, chargeback is available on both debit and credit cards, and there is no minimum purchase amount. However, it is a card scheme voluntary process rather than a statutory right, and card issuers have discretion in how they handle claims. The time limit for chargeback claims is typically 120 days from the transaction date or the expected service delivery date, whichever is later; for future-dated travel bookings, the 120 days runs from the date of the holiday, not the booking date. Submit a chargeback claim to your card issuer in writing as soon as possible after the supplier refuses to refund, providing your booking confirmation, the cancellation evidence, and details of your attempts to resolve the matter with the supplier first.

Package holiday rights under the 2018 Regulations

The Package Travel and Linked Travel Arrangements Regulations 2018 apply when you book a package holiday - defined broadly as a combination of at least two of the following: transport, accommodation, car hire, or another tourist service, where the combination is sold at an inclusive price and covers at least 24 hours or includes overnight accommodation. Under the Regulations, if the operator cancels a package, you are entitled to a full refund within 14 days without paying a cancellation fee. If you wish to cancel due to unavoidable and extraordinary circumstances (UAECs) at the destination - such as a natural disaster, civil unrest, or a health emergency that materially affects the holiday - you can cancel and claim a full refund. The test for UAECs has been applied by courts in the post-Covid era; check the FCDO's current travel advice for your destination and the supplier's terms for how they define UAECs. If the refund is not issued within 14 days of a lawful cancellation, you can claim interest and escalate to an ADR scheme or court.

ATOL protection

The Air Travel Organiser's Licence (ATOL) scheme, administered by the Civil Aviation Authority, protects consumers who book ATOL-bonded package holidays including flights if the travel company collapses. If your ATOL-bonded operator fails, the CAA arranges for people already abroad to be repatriated and refunds those who have not yet travelled. You should receive an ATOL certificate when you book; check that your holiday operator holds ATOL at caa.co.uk before booking. Note that ATOL only covers packages where a flight is included; accommodation-only bookings do not attract ATOL protection. Stand-alone flight bookings with an airline do not attract ATOL protection either; the airline failure risk on direct flight bookings is mitigated by Section 75 or chargeback if you paid by card.

Flight compensation under UK-SPEC261

UK261 (the UK retained version of EU Regulation 261/2004, now enacted as UK-SPEC261) provides statutory compensation for flight cancellations and significant delays where the airline is responsible. Compensation is £220 for flights up to 1,500km, £350 for flights between 1,500km and 3,500km, and £520 for flights over 3,500km, payable per passenger. Airlines are not required to pay compensation if the cancellation or delay was caused by extraordinary circumstances outside their control, such as severe weather, air traffic control strikes, or security emergencies. Claim directly with the airline first; if rejected or ignored, escalate to the Civil Aviation Authority (for airlines not participating in an ADR scheme) or an approved ADR body. The CAA's website lists which airlines belong to which ADR scheme.

Related guides

Frequently asked questions

I paid by debit card - can I use Section 75?

No. Section 75 applies only to credit card payments. For debit card payments, use the chargeback process through your card issuer. Chargeback is available for both debit and credit cards but is a card scheme voluntary process rather than a statutory right, so the outcome is less certain than a Section 75 claim. Contact your bank as soon as possible and explain that you paid for services that were not delivered.

What does ATOL protection cover?

ATOL protects customers of ATOL-bonded package holiday operators if the operator becomes insolvent. If you are already abroad when the company fails, ATOL ensures you are repatriated. If you have not yet travelled, ATOL refunds the cost of your holiday. ATOL applies to packages that include a flight; accommodation-only bookings or stand-alone flight bookings with airlines are not covered by ATOL. Check your operator's ATOL status at caa.co.uk before booking.

Can I cancel a package holiday and get a full refund due to FCDO warnings?

If the FCDO advises against travel to your destination, this is strong evidence of unavoidable and extraordinary circumstances under the Package Travel Regulations 2018. Most package operators will offer a refund or rebooking in this situation. If the operator refuses, raise a formal complaint citing the Regulations and escalate to the relevant ADR scheme. The position is less clear if the advisory was issued before you booked, as you may have accepted a known risk.

How long does a Section 75 claim take?

There is no statutory time limit for the credit card issuer to process a Section 75 claim, but FCA complaint handling rules apply: the issuer must acknowledge within five working days and resolve within eight weeks. In practice, straightforward Section 75 claims for clearly cancelled bookings are often resolved within two to four weeks. If the claim is disputed and requires investigation, it may take longer. Escalate to the Financial Ombudsman if unresolved after eight weeks.

My airline has offered a voucher instead of a cash refund. Do I have to accept it?

No. If your flight was cancelled by the airline, you are entitled to a full cash refund under UK-SPEC261, not just a voucher or rebooking. You can choose to accept a voucher if you prefer, but you cannot be forced to. If the airline only offers a voucher, reject it in writing and request a cash refund. If refused, raise a complaint with the airline and escalate to the relevant ADR scheme or the CAA.

How we verified this guide

All legal rights and refund processes were verified against the Consumer Credit Act 1974, Package Travel and Linked Travel Arrangements Regulations 2018, UK-SPEC261, ATOL scheme guidance from the Civil Aviation Authority, and Citizens Advice holiday refund resources during May 2026. We do not accept payment from travel companies or claims handlers.

Disclaimer: This guide is information only, not legal advice. Rules and time limits change. Always check the primary sources cited and consult a regulated adviser for decisions about your own circumstances.

Primary sources

Last reviewed: May 2026.