Interest paid as 'bonus'

Chip has a on-line savings account that pays a monthly bonus rather that interest - a specific term on the account. I am assuming that this is treated as interest for tax purposes because: 1. It is entirely dependent on the account balance 2. It is paid regularly (monthly) 3. It has a defined contractual rate 4. It is income not a return of capital Please could someone confirm? Thanks!

Hi,

The taxation of such payments depends on whether they are treated as annual payments or not. You can see guidance below that contains a link to examples:

SAIM8020 - Annual payments: meaning of annual payment

Thank you.