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Posted Sun, 23 Jul 2023 08:11:23 GMT by csl77
Hi admin, I am not self-employed or running business. I intend to buy a new build home to live in (not investment), I will pay the market sales price in full by cash but there is a cash-back in a sum of £26,400 from the Developer as an allowance to me upon completion. Is this cash-back money regarded as taxable income? If yes, which part of the SA100 should be filled in? Please advise, thank you very much. csl77
Posted Tue, 01 Aug 2023 09:19:23 GMT by HMRC Admin 19

Cashbacks that can be categorised as inducements, to an individual who is not running a business, to enter into a transaction for the purchase of goods, investments or services, and are received as a direct consequence of having entered into that transaction, are not taxable. Based on the information you have provided, the cashback sum you received from the property developer is not taxable. You can see guidance here:                                       

Statement of Practice 4 (1997)            

The following guidlines also outlines that cashback, in the terms outlined, are not a capital sum and not liable to Capital Gains Tax: 

CG13027 - Incentive payments/financial institutions: cashbacks: contractual rights

Thank you.

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