[toots66]

Find a deal on another network that offers you what you want as this is a good bargaining position. Look on the networks' own websites as they usually have extra minutes/texts which you can't get through a dealer. Even if you don't really want to move to 3, say, you can at least tell them that it's too good an offer to miss. The problem might be if you want the lowest possible monthly price, they might not be too interested in keeping you as a customer.

When I cancelled a T-Mobile contract earlier this year they offered me a much better deal than Vodafone had (12 months @ £30), and with a significant discount off their standard contracts to boot (I can't remember the details but I was shocked at how much they knocked off), except they didn't have the phone that my wife wanted. Typical.

I'm not sure where they'd stand if you mention cashback deals to them. The cashback is part of the commission that the network gives to the dealer for getting them a new customer so they may well offer you a discount off the usual monthly price to keep you as a customer and not have to pay the dealer, but it might not be as good as the cashback.

If you wanted to get a new T-Mobile contract from a dealer, you wouldn't be able to use your PAC as it's the same network. You could PAC to PAYG on a different network and then PAC to T-Mobile but it's a hassle and you'd have to be on PAYG rates for up to a month or so.

As for paying an extra month's line rental at £25, this shouldn't happen. One month before the contract is up, phone them and tell them you want to cancel and are giving a month's notice. They'll then try to dissuade you and it's at this point that you tell them about another network's deal to see what they offer, which you can either accept or reject. If you're not sure and want to research it further, tell them you'll think about it and call them back later that day. You can either give notice or ask for a PAC but not both; if you ask for a PAC you must use it within a month otherwise the contract will continue. If you give notice and later ask for a PAC, this cancels the termination notice so don't get caught out: you must use the PAC.

Note that if you do want a PAC, T-Mobile ask for the remaining line rental by credit/debit card there and then i.e. £25. You should then use the PAC ASAP (same day if pos) as this will mean your contract with T-Mobile terminates ASAP and you get the maximum money back from them. (You'll need to check with them as to exactly what happens; I got the credit back onto my account as I have another phone with them.) The amount they want for the PAC reduces on a daily basis; if you don't want to pay for the PAC on principle, you'd have to ask for it on the day after the 12 months is up but then you would end up paying out for another month's rental and waiting for them to refund for the unused part of the month. A PAC normally takes 5 working days to process = 7 calendar days, so you might prefer to ask for it a week before the 12 months is up which minimises the amount you'd have to pay for it and stops them charging you for an extra month. Maybe give yourself a couple of days leeway to be on the safe side. IME, Orange and O2 don't ask for payment when you want a PAC so this might just be a T-Mobile thing.

It is, of course, a lot simpler if you don't want to keep your number! If you've seen a cashback deal with T-Mobile then the PAC is pretty much useless anyway.