By Crystal Colwell / June 12th, 2013
While it is widely known that Microsoft is doing away with their point system in favor of a cash system, many questions still remain. I have poured over the support information concerning this transaction to see if I can best answer any lingering questions.
As part of a fall 2013 update Microsoft Points will be retired. Transactions from this point on will be done with local currency. The monetary value of your MS points will be converted over to your local currency. As long as your account location is set to one of the following countries listed in the table below, and you have a billing account on file in your Microsoft account there will be nothing else you personally have to do (as of now) for this change to take place.
The exchange will be done at an equal to or greater value from MS points to your local currency. While you will be getting at least the going rate for MS points there is a catch. The following is quoted directly from the support page for the Xbox:
The purchase funds you deposit into your account after the transition will not expire. However, the funds we deposit into your account at the time of the transition will expire one year from the deposit date.
Essentially what this means is that whenever this change takes effect ( Fall 2013) you will have one year to spend the money in your account that was converted from your old MS Points. Interesting. This begs the question: will your account know the difference between the money you received as a part of this exchange and the money you have since added? Another burning question that was brought up by a fellow journalist here at oprainfall is this: what about states or countries that have laws against gift cards expiring? One could say that once the points were converted to cash, the gift card laws may no longer apply, but that is only an educated guess.
As for your MS Point cards that you may have lying around, it is perfectly OK to redeem them now or through 2014 (and for a limited time thereafter) and you will simply receive the monetary amount instead of the points. Once you have deposited your points (or money) you will not be able to get them back or transfer them to another account. You will also not be able to split any payments between an Xbox Gift card and money in your account.
The tax situation looks like this: when you purchase content with funds that MS deposited into your account (in exchange for the points) no taxes will be applied. When you use money that you have added to your account, you will be paying taxes on the purchase.
I hope this helps clear up any questions about the currency exchange. If it leaves you with more questions then answers, don’t feel alone in that, but do feel free to voice concerns or ask for more information in the comment section below.
Microsoft Xbox One