Tax on bank cashback

uk1

Seen so much contradiction!  Is cashback from banks currently added to interest for tax purposes please?  To me it has always seemed like a refund rather than interest!

Thanks

molerat

A lot seems to depend on what the actual payment is

https://www.sussexexpress.co.uk/business/im-not-sure-if-my-bank-reward-account-income-should-be-included-as-interest-received-957992

If the income received is cashback for purchases made on certain cards or for direct debits being set up,; this is currently being classed as a discount to the product or service you have bought, therefore, it is not taxable by HMRC.

Santander 123 easily falls into that category but not sure where the simple £5 per month ones would come.

uk1

Many thanks … on that basis I think Chase is safe ….

chrisbur

molerat said:

A lot seems to depend on what the actual payment is

https://www.sussexexpress.co.uk/business/im-not-sure-if-my-bank-reward-account-income-should-be-included-as-interest-received-957992

If the income received is cashback for purchases made on certain cards or for direct debits being set up,; this is currently being classed as a discount to the product or service you have bought, therefore, it is not taxable by HMRC.

Santander 123 easily falls into that category but not sure where the simple £5 per month ones would come.

The £5 per month given by Halifax is considered to be payment after the deduction of tax at 20%  Not sure if you would need to claim if you were not liable for tax as I do self assessment and include it as having tax paid on that.

PennyForThem_2

molerat said:

A lot seems to depend on what the actual payment is

https://www.sussexexpress.co.uk/business/im-not-sure-if-my-bank-reward-account-income-should-be-included-as-interest-received-957992

If the income received is cashback for purchases made on certain cards or for direct debits being set up,; this is currently being classed as a discount to the product or service you have bought, therefore, it is not taxable by HMRC.

Santander 123 easily falls into that category but not sure where the simple £5 per month ones would come.

Really?  But if do not do self assessment tax is this recognized and do Santander separate it out to HMRC?  Or, is it all lumped together - the interest on your Santder account and your 'cashback'???