Holidaymakers were told yesterday they would have to pay twice for their overseas accommodation following the collapse of the tour operator Sun4U.

The Birmingham-based company ceased trading on Wednesday night, with about 1,200 UK holidaymakers abroad, mostly in Spain.

Some of these are covered by the Civil Aviation Authority's Atol (Air Travel Operators' Licensing) scheme and will be able to carry on with their holidays and travel home. But Sun4U also organised flight-only and accommodation-only trips which are not covered. Also, the CAA said that, even if trips are covered, "hotels may require customers who are abroad to pay again for their accommodation".

The CAA said that Atol-covered holidaymakers would be able to claim this money back from the CAA. It advised such customers who find their airport transfer and accommodation has become unavailable to make their own arrangements and then send a claim to the CAA.