INCOME TAX16 Sept 2026
Do you pay tax on credit card cashback, referral bonus or old phone sale? Explained | Mint
Money landing in your hands from cashback, referral bonuses, or selling an old phone is taxed differently. Regular credit card cashback tied to spending is usually treated as a discount, not income, so you need not report it in your ITR. Referral money, however, is taxed under Income from Other Sources. Sale of personal items like phones, furniture, or clothes stays exempt.
Key Statutory Highlights
- Credit card rewards such as cashback, reward points and air miles are generally seen as a discount linked to spending, so they are not treated as taxable income.
- Referral bonus money earned occasionally by someone not running it as a business is generally taxable under Income from Other Sources, covered by Section 56 of the Income-tax Act.
- Gains from selling personal effects held for personal use, such as mobile phones, laptops, furniture, cars, crockery and clothing, are exempt from tax.
Actionable Advice for Taxpayers / Founders:Keep a simple record of referral earnings and any rewards linked to business spending, and check with your tax professional before filing your ITR if these amounts are large or you have monetised them.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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