How sneaky £3 fees for using your card inside the UK are catching people out

There are important differences between spending on a debit or credit card, but they're not things people are always aware of.

Using a card, especially if you pay the balance off in full each month, has a few advantages. For one, you can earn rewards like airmiles, loyalty points or cashback. For another you get some extra protection if things go wrong with your purchases.

But there are certain things that you shouldn't do - because they end up costing you more. Taking cash out, for example.

That attracts a fee of £3 or 3% (whichever is higher), as well as voiding the 49-day interest free period you normally get on purchases meaning you start racking up charges instantly.

But while that is relatively well known, what a lot of people don't realise is credit card companies class quite a few things as "cash" transactions.

Many people don't realise until they see their bill (Getty)

TotallyMoney chief executive Alastair Douglas said: “If customers aren’t aware of a cash advance fee, they may use their credit card in the same way as a debit card.

"In some instances, people might not realise a fee or interest is added until they check their statement.”

When they checked how aware people were about what counted as a "cash" transaction, seven in eight didn't realise paying an entry fee for a fantasy football team counted, six in seven had no idea a cash advance fees applied to lottery tickets.

Another three quarters (76%) didn't realise a deposit on a gambling website incurs a cash advance fee, while almost two in three (66%) didn't know exchanging foreign currency also triggers a cash advance fee.

You can get a cash charge even when buying things online (Getty)

To try and clear things up, TotallyMoney produced the following list of things credit card companies class as "cash":

• ATM withdrawals - This cash transaction is the one that most people are aware of. Over half (51%) of people know withdrawing cash from an ATM with your credit card will involve a fee. Always try to avoid using your credit card to withdraw cash.

• Any form of gambling - Playing in a casino, buying a lottery ticket, placing a bet, and entering a fantasy football team are all forms of gambling. As such, they all include a cash advance fee when bought with a credit card.

• Gift cards - This one can be a surprise for customers. Buying a gift card is considered a cash transaction. Be aware of this when purchasing a gift card and opt to pay with cash or debit card instead.

• Currency exchange - Just over a third of people (36%) know exchanging currency could incur a cash advance fee. When exchanging money for a holiday, people may be keen to convert a lot of cash. But, this could result in a very high fee based on the percentage of the amount changed.