| Personal income tax - other income [message #383867] |
Mo, 01 Mai 2006 20:15 |
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Is any of the following taxable income?
1) cashback from cashback credit cards
2) cashback from cashback sites such as Rpoints, Quidco, etc.
3) joining incentives (e.g. for opening a bank account)
4) referral incentives (e.g. for recommending a product to a friend)
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| Re: Personal income tax - other income [message #383872 ] |
Mo, 01 Mai 2006 20:49 |
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"Anon" <invalid [at] invalid.invalid> wrote in message
news:pan.2006.05.01.18.15.04.512829 [at] invalid.invalid...
> Is any of the following taxable income?
>
> 1) cashback from cashback credit cards
Only if you earned the cashback from business expenditure (eg paying for hotels,
meals etc on business trips which you claim back on expenses).
> 2) cashback from cashback sites such as Rpoints, Quidco, etc.
Probably same as above.
> 3) joining incentives (e.g. for opening a bank account)
No. I guess there are rules the banks have to follow here to stop them disguising
interest (which is taxable) as an incentive.
> 4) referral incentives (e.g. for recommending a product to a friend)
Probably not, unless you are acting as an agent. Eg if you have a web site and get
referral commission from anyone who visits your web site and signs up to a third
party product from there, that will definitely be taxable.
That's my understanding anyway. Phone your tax office, they are generally very
helpful.
--
Andy
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| Re: Personal income tax - other income [message #383902 ] |
Di, 02 Mai 2006 14:03 |
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On Mon, 1 May 2006 19:49:12 +0100, "Andy Pandy"
<spam8times [at] wonderful.spam.invalid> wrote:
>
>"Anon" <invalid [at] invalid.invalid> wrote in message
>news:pan.2006.05.01.18.15.04.512829 [at] invalid.invalid...
>> Is any of the following taxable income?
>>
>> 1) cashback from cashback credit cards
>
>Only if you earned the cashback from business expenditure (eg paying for hotels,
>meals etc on business trips which you claim back on expenses).
>
>> 2) cashback from cashback sites such as Rpoints, Quidco, etc.
>
>Probably same as above.
>
>> 3) joining incentives (e.g. for opening a bank account)
>
>No. I guess there are rules the banks have to follow here to stop them disguising
>interest (which is taxable) as an incentive.
>
>> 4) referral incentives (e.g. for recommending a product to a friend)
>
>Probably not, unless you are acting as an agent. Eg if you have a web site and get
>referral commission from anyone who visits your web site and signs up to a third
>party product from there, that will definitely be taxable.
>
So where would you draw the line? Emailing friends and getting them to
join? Would that be income?
>That's my understanding anyway. Phone your tax office, they are generally very
>helpful.
--
Get money off vouchers for everything
http://www.moneyoffvouchers.co.uk
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| Re: Personal income tax - other income [message #384751 ] |
Mi, 03 Mai 2006 10:03 |
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On Mon, 01 May 2006 19:49:12 +0100, Andy Pandy wrote:
Thank you for your reply.
> "Anon" <invalid [at] invalid.invalid> wrote in message
> news:pan.2006.05.01.18.15.04.512829 [at] invalid.invalid...
>> Is any of the following taxable income?
>>
>> 1) cashback from cashback credit cards
>
> Only if you earned the cashback from business expenditure (eg paying for hotels,
> meals etc on business trips which you claim back on expenses).
Where did you come across this information?
>> 2) cashback from cashback sites such as Rpoints, Quidco, etc.
>
> Probably same as above.
>
>> 3) joining incentives (e.g. for opening a bank account)
>
> No. I guess there are rules the banks have to follow here to stop them disguising
> interest (which is taxable) as an incentive.
Why should this income not be taxable? I saw a list of non-taxable income
on the HMRC site and only very few types of income were not liable to tax.
Is it not the case that the IR turn a blind eye to small fry
like this rather than it not being liable to income tax?
>> 4) referral incentives (e.g. for recommending a product to a friend)
>
> Probably not, unless you are acting as an agent. Eg if you have a web site and get
> referral commission from anyone who visits your web site and signs up to a third
> party product from there, that will definitely be taxable.
As a previous poster said: where would the line be drawn? What if you
email 100 friends and persuade them to join? You could easily make a few
thousand quid.
People trade referral incentives on fora without necessarily having a
website with a link.
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| Re: Personal income tax - other income [message #384754 ] |
Mi, 03 Mai 2006 10:40 |
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Anon wrote:
> On Mon, 01 May 2006 19:49:12 +0100, Andy Pandy wrote:
>> "Anon" <invalid [at] invalid.invalid> wrote
>>>
>>> Is any of the following taxable income?
>>>
>>> 1) cashback from cashback credit cards
>>
>> Only if you earned the cashback from business expenditure (eg paying for
>> hotels, meals etc on business trips which you claim back on expenses).
>
> Where did you come across this information?
It isn't information as such, just common sense.
What are actually asking to be clarified, why personal cashback is not
taxable, or why business cashback is?
Personal cashback isn't taxable because it isn't income, it's a discount.
Business cashback is taxable because it's a discount for your business or
employer, and if you keep it, it counts as income because in effect it's
something your business or employer has given you.
>>> 3) joining incentives (e.g. for opening a bank account)
>>
>> No. I guess there are rules the banks have to follow here to stop them
>> disguising interest (which is taxable) as an incentive.
>
> Why should this income not be taxable? I saw a list of non-taxable income
> on the HMRC site and only very few types of income were not liable to tax.
> Is it not the case that the IR turn a blind eye to small fry
> like this rather than it not being liable to income tax?
I think it's not liable because it simply isn't income as such.
It's a discount in advance. In the case of opening a bank account,
think of it as a discount in advance towards future bank charges.
>>> 4) referral incentives (e.g. for recommending a product to a friend)
>>
>> Probably not, unless you are acting as an agent.
>
> As a previous poster said: where would the line be drawn? What if you
> email 100 friends and persuade them to join? You could easily make a few
> thousand quid.
This is a difficult one. Referral incentives are a bit like joining
incentives, except that *you* get the friend's joining incentive (advance
discount) instead of the friend keeping it. Inasmuch as you could view
this as a gift from the friend to you, it would not be taxable. But this
could be shaky ground.
It would be different if the referral incentive were not cash but in the
form of a discount to you. For example your insurer may tell you that for
every friend you refer you will get £20 off your next renewal premium.
That would be a discount and not taxable. If the incentive is in form
of cash rather than discount vouchers, the position should be the same
*except* when it gets silly, i.e. you receive more incentive cash than
you could spend on your premiums. If your renewal premium is only £100
and you refer 7 friends, that might still be OK since you'd get 100% off
this renewal and £40 off the next one, but if you find yourself with 20
years' worth of premiums in the bag, it will look a bit embarrassing.
In such cases you'd be treated as a recruiting agent working for the
insurance company, which would not only make the money taxable, but
could well render you (and them!) liable for NI contributions too.
It doesn't answer the question of where the line is drawn, but it would
be on the basis of volume, I'd have thought. Something like if the long
term average incentives exceed your own premiums payable, then the excess
would be deemed income.
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| Re: Personal income tax - other income [message #384787 ] |
Mi, 03 Mai 2006 20:03 |
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"Ronald Raygun" <no.spam [at] localhost.localdomain> wrote in message
news:u0_5g.63422$wl.61336 [at] text.news.blueyonder.co.uk...
> >>> 3) joining incentives (e.g. for opening a bank account)
> >>
> >> No. I guess there are rules the banks have to follow here to stop them
> >> disguising interest (which is taxable) as an incentive.
> >
> > Why should this income not be taxable? I saw a list of non-taxable income
> > on the HMRC site and only very few types of income were not liable to tax.
> > Is it not the case that the IR turn a blind eye to small fry
> > like this rather than it not being liable to income tax?
>
> I think it's not liable because it simply isn't income as such.
> It's a discount in advance. In the case of opening a bank account,
> think of it as a discount in advance towards future bank charges.
But you can get these incentives on savings accounts which don't have charges. It
does seem odd that incentives aren't taxable in these cases since they really can
only be considered to be advance interest, rather than a discount on charges, and
interest of course is taxable. And it would be easy to tax - the bank would simply
have to pay it in the same way as it pays interest - net unless the "gross interest"
declaration is filled in.
--
Andy
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