Income Tax cash incentives for banking customers

This question we’ve been asked explains the income tax treatment of a cash incentive payment (also known as a cashback payment) that a bank pays to a borrower who is a cash basis person under the financial arrangements rules. It explains when a cash incentive payment will not be taxable and will not give rise to any tax obligations for the borrower who receives it. It also explains when a cash incentive payment will be taxable and the time at which it must be accounted for when it is.

If you would like a copy of this in Word, contact us using the Feedback button below.