Compliance guide

Gift card expiry laws by country

Most countries regulate gift card expiry, inactivity fees, and disclosures to protect consumers. The rules vary materially across regions, so this guide summarizes the headline obligations in the markets Wrapped customers most often sell into. It is general information for merchants, not legal advice — consult counsel before publishing terms.

United States

The federal Credit Card Accountability Responsibility and Disclosure Act of 2009 (the CARD Act), implemented through Regulation E, sets baseline gift card rules. Funds on a covered gift card must remain valid for at least five years from purchase, with reload money valid for at least five years from the most recent reload. Inactivity, dormancy, or service fees can only begin after twelve consecutive months of non-use, must be limited to one per month, and must be conspicuously disclosed on the card or accompanying terms before purchase.

Many states layer stricter consumer protections on top of the CARD Act. California, for example, prohibits expiry on most retail gift certificates entirely and only allows fees in a narrow set of conditions. Connecticut, Massachusetts, Rhode Island, Maine, Minnesota, Montana, New Jersey, Vermont, and Washington each have their own gift card statutes that override or supplement federal rules. New York requires balance disclosures and limits service fees to those after 24 months of inactivity. If you sell into multiple states, the safest approach is often to set program terms to the most restrictive state in which you operate.

Unredeemed balances are also subject to escheat laws — most states require unclaimed property reporting, with holding periods ranging from 2 to 5 years depending on the state and gift card type. Some states exempt retail gift cards entirely; others apply full escheat to balances. Tracking date of last activity per card is essential for compliance.

Canada

Each Canadian province regulates gift cards under its consumer protection legislation. Across most of the country — Ontario, British Columbia, Alberta, Manitoba, Saskatchewan, Nova Scotia, New Brunswick, PEI, Newfoundland & Labrador, and Quebec — general-use single-merchant gift cards cannot expire. Exceptions exist for promotional cards (where the retailer didn't receive money for the card), gift cards for a specific service or product (such as a haircut or a meal at a particular restaurant), and reloadable multi-merchant prepaid cards.

Inactivity and dormancy fees are similarly prohibited or sharply limited on single-merchant cards. Multi-merchant gift cards (such as mall or open-network cards) can have administrative fees but only after disclosed dormancy periods. Quebec uniquely requires gift cards sold for a specific service to honour the original cash equivalent if the service is no longer offered.

Australia

Since 1 November 2019, the Australian Consumer Law (administered by the ACCC) requires that gift cards sold to consumers be valid for a minimum of three years from the date of supply. The expiry date and any post-supply fees must be displayed clearly on the card or its packaging. Most post-supply fees are prohibited — only currency conversion fees, payment surcharges, and booking fees through third-party platforms are permitted.

These rules apply to most gift cards including retail gift cards, store credit, and prepaid cards intended as gifts. Exclusions exist for cards used as part of an employee rewards scheme, donations, certain reloadable cards, and goodwill or promotional cards (where the consumer didn't pay). The ACCC has published clear guidance and enforces actively against non-compliance.

New Zealand

New Zealand has no statutory minimum expiry period for gift cards, but the Fair Trading Act 1986 requires that any expiry, fees, or terms be communicated clearly and accurately at the time of sale. Misleading or inadequate disclosure can constitute deceptive conduct. The Commerce Commission has issued guidance to retailers, and the Consumer Guarantees Act 1993 may also apply where a gift card is treated as a service.

In practice, most New Zealand retailers offer minimum 12-month expiry as a baseline, with many opting for 24 or 36 months as a competitive consumer-friendly stance. Best practice is to surface the expiry date both on the gift card itself and at the point of sale.

United Kingdom

The UK doesn't impose a statutory minimum expiry on gift cards or vouchers. However, the Consumer Rights Act 2015 prohibits unfair contract terms, and the Competition and Markets Authority has signalled that very short expiry windows may be unenforceable. Gift cards must comply with consumer information requirements: terms (including expiry, restrictions, and fees) must be clear and prominent before purchase.

On the tax side, HMRC distinguishes between single-purpose vouchers (where VAT is due at the point of sale) and multi-purpose vouchers (where VAT is due at redemption). The 2019 Vouchers Directive harmonized this approach across the EU and was adopted into UK law.

European Union

EU member states regulate gift cards through national consumer protection laws. The 2019 Vouchers Directive standardized VAT treatment but expiry rules remain national. Germany and France allow expiry but typically require minimum 1- to 3-year periods. The Nordic countries tend to require longer minimums or prohibit expiry on retailer-issued cards.

How Wrapped helps merchants stay compliant

Wrapped's gift card platform lets you set per-region expiry policies, surface them automatically on emailed and printed gift cards, and track last-activity dates per card for escheat reporting. The liability dashboard breaks balances down by issue date, last-activity date, and channel, making both unclaimed-property reporting and breakage recognition straightforward.

Combined with native POS and eCommerce integrations, balances stay synchronized so a card sold in one channel and redeemed in another follows the same expiry and disclosure rules everywhere. For multi-region brands, this avoids the most common compliance failure: stale terms on one channel diverging from the canonical program.

Frequently asked questions

Do gift cards have to expire by law?

No, in most jurisdictions gift cards are not required to expire — many laws prohibit expiry within a minimum period (typically 1 to 7 years), and some jurisdictions require gift cards to be effectively non-expiring.

Can I charge inactivity or dormancy fees on a gift card?

Inactivity fees are heavily restricted. Under the U.S. CARD Act, fees can only be charged after 12 months of inactivity, must be disclosed clearly, and only one fee per month is permitted. Several U.S. states ban inactivity fees entirely. Australia, New Zealand, and the EU have similar restrictions or outright bans.

What happens to gift card balances I never have to honour?

Unredeemed balances may eventually be considered "breakage" and recognized as revenue, but in many jurisdictions the unredeemed balance can be subject to escheat (unclaimed property) laws, requiring the issuer to remit the funds to a government authority after a holding period.

Do these laws apply to digital gift cards too?

Yes, in most jurisdictions the consumer protection rules for gift cards apply equally to digital and physical formats. Some laws use the broader term "gift certificate" or "stored-value card" to cover both.

This guide is general information current as of publication. Laws change — verify current obligations with qualified legal counsel before launching or revising your gift card program.