How to avoid the Betfair premium charge

[xitian]

I personally know of people who have been trading on BF for several years making substantial amounts, in 6 figures (£) and have never paid a single penny in PC. Don't take this the wrong way but you need to learn more about how the PC works as you don't seem to understand it. It will be time well spent I assure you.

If you're in the higher levels of the PC then your commission generated would have to be >40% of your gross profits which is tough work! Unless you're arbing or something similar (which is hard work in itself).

It can't simply be about understanding it though, right? Andy, haven't you given up trading on Befair yourself because of the PC charge? Any reason why you're not doing the same thing as these other traders you mention?

I think it's possible to avoid paying PC if you are coming up to it, but if you were caught by Betfair applying it retrospectively you are a bit stuffed.

Note that changing band is retrospective as well. So if you can move from <5% to >5%, or <10% to >10% then you will earn back the PC that you overpaid while being in the previous band. This is likely to be £10,000s if you're a higher rate payer.

[andyfuller]

Your right , i dont understand it becuase the Betfair site says this :

"Higher rates of Premium Charge will apply to the very small number of customers (less than 0.1%) that satisfy the following conditions over the lifetime of their account:

Lifetime net profits exceed £250,000"

So if you know people that have made 6 figures over several years then that would put them in or around that bracket but they don't pay a penny ?

I shall study further as maybe its not as bad as i thought........................

Have a read through this link: http://www.betfair.com/aboutUs/Betfair. ... /#charges7

There are more criteria to the PC than just making £250,000.

[andyfuller]

It can't simply be about understanding it though, right? Andy, haven't you given up trading on Befair yourself because of the PC charge? Any reason why you're not doing the same thing as these other traders you mention?

It isn't just about understanding it, it is also about implementing what you understand. The people who I mentioned previously were 'lucky' with the PC. Their historical use of Betfair meant that they did not meet the Total Charges %. For example due to Arbing in the past when it used to be relatively easy, amongst other things.

This meant that their TC's was very high already or they had been fortunate to transfer their profit from Betfair elsewhere long before the PC came in. So when the PC came in they were way off the thresholds. Then by altering slightly their approach and implementing new approaches they were able to do as Peter Webb mentions and work with the PC to ensure their TC's remained artificially high and/or transferred profits away from Betfair.

As this was historically how they used their account anyway they have not had any issues with PC avoidance charges being waved at them.

So as Peter said I think, if you are new to this and/or don't yet meet the criteria there are things you can do to help avoid or reduce the impact. For me, my approach historically meant I was so far gone it was just not worth the effort trying to reverse it, so I have moved on but still like to keep abreast of BF things just in case the flock of pigs fly past my window and the situation changes and also just because I still really enjoy all things trading.

[steven1976]

How easy is it to transfer the funds away Andy? I know in the past you were worried that if you got on a bad run you could actually end up getting in a worse pickle if for example you tried moving winnings to betdaq.

[THENUTS]

Thanks for your comments Andy. I think i get it now.

If you have not already met the criteria for PC then keep your commission paid as a % of gross profits high enough using a variety of methods to ensure that you always stay below the level where the PC kicks in

Is that right ?

[rommel93]

I think it's possible to avoid paying PC if you are coming up to it, but if you were caught by Betfair applying it retrospectively you are a bit stuffed. But there are things, like the Betdaq free commission races that work very effectively to increase your commission paid without losing money so everybody should be doing something on that.

euler an letiss can you be more exact with methods of avoidingcan you post real example if not here becouse someone in betfair might read this(i would do that if i was on their side) in private messege i would be very very grateful if you guys share your knowledge with me.

[tees]

For anybody that has made consistent profits and been paying PC for a while, it's almost impossible to hoodwink BF. They will notice a rapid change in your trading style and just flag your account for PC avoidance.

Are you saying that if you are approaching £250K and then change your betting/trading style this will be seen as PC avoidance?

[tees]

I am approaching £250K, but this last year things have really slowed down as the markets I play are changing. I can overcome this 'slow-down' by changing the way I trade/bet. Side-effects of this change would be increased variance (which I hate) but that I would be paying less PC, or at least bring me down from 50% PC to 40% PC when reaching the threshold. How I'm reading this thread is that my change of strategy will be seen as PC avoidance

[PeterLe]

I am approaching £250K, but this last year things have really slowed down as the markets I play are changing. I can overcome this 'slow-down' by changing the way I trade/bet. Side-effects of this change would be increased variance (which I hate) but that I would be paying less PC, or at least bring me down from 50% PC to 40% PC when reaching the threshold. How I'm reading this thread is that my change of strategy will be seen as PC avoidance

Edit:

Tees
I was just thinking; what's to stop the PC2 trader from setting up an account in the name of one of his family?
Regards
Peter

[tees]

Tees
I was just thinking; what's to stop the PC2 trader from setting up an account in the name of one of his family?
Regards
Peter

Hmmm... you're kidding, right? Peter?

If I remember correctly, didn't Mr and Mrs W have their accounts suspended for something similar? I would hate to lose 50% of something for an indiscretion that was at best a long shot... ?

[Euler]

If you reach higher levels of PC then you may as well churn your account with arbs up to that value in commission, the net effect will be to pay the same but with commission but that will end up reducing your premium charge any how. If you are at higher levels it will, eventually, mean that you go from 60-40% PC.

The lifetime component of the PC has never made sense to me, basically people who had an edge but lost it have no incentive to return and try again. Probably explains why liquidity is weakening.

[kemabet]

Oh no, I think I am in trouble now. Betfair has threatened to close my account immediately if I ever try to avoid the 60% premium charge I am under. When they took a four figure sum as punishment from my account when they were thinking I was trying to do that, "Now it should be perfectly clear for you that ..", from their email.
When I started on Betfair eleven years ago I was in big minus after ten days, but after that not many minus days in a row. But now already a long period of time I have been making minus and I am afraid that Betfair in their paranoia will now think that I have found a way to avoid the PC by playing out the money from Betfair. I don't keep so much money in my account nowadays because Betfair can rob them any time, but I would feel a little sad to be hit, closed and finished after being with Betfair so long time.
So, I really need now to do better and make plus again!!!

[phartnett6]

what is a betfair premium charge??

[PeterLe]

what is a betfair premium charge??

Section 7:

http://www.betfair.com/aboutUs/Betfair.Charges/

[gazuty]