Posts Tagged ‘Topcashback’
Everyone knows the insurance industry is the worst kind of old boys club. Well, perhaps not the worst kind. Still, the fact that financial advisers can be sunning themselves on a cruise paid for on the back of advice given 20 years ago is why the whole financial services regime is currently undergoing a ‘reform’ to make it more transparent for everyone involved, with such ‘trail commission’ payments expected to be banned from 2014.
Now, HMRC have decided to get in on the act, with a new ruling that any such commissions that are thrown back to consumers will, from April onwards, be taxable. Earlier years’ bonuses will not be taxed. The insurance industry are perturbed by this new announcement, but are trying to spread the bad news by insinuating they are merely the first step on an HMRC cashback rampage.
The payments in question are basically repeat commission paid annually on longer term insurance-type investments. If you purchased the product with the help of a financial adviser, you can rest assured that he has been enjoying the benefit of the annual charge-back ever since you took it out. However, if you did not have an adviser, or in certain other circumstances, the investment product provider or broker will get the bung instead. Such firms are under no obligation to show you a penny of this free commission, but some do, notably Hargreaves Lansdowne who repay 16% of any commission received to its investors as a ‘bonus’. It is this cash payment returned to customers, either by way of an account credit or set off against management fees that HMRC have now ruled as chargeable. As far as they are concerned, it is an income generated by your investment, so unless it’s in a tax-free wrapper like a Stocks ISA or a SIPP, it’s fair game.
Hargreaves Lansdown, who is the largest bonus re-bunger, is understandably unimpressed. “It seems the Government is now seeking to tax small savers and investors. This is effectively a second tax on their income,” grumbled chief executive Ian Gorham.
However, he didn’t stop there, complaining to the Telegraph that it wasn’t just sour grapes, he was merely concerned that “the government may have set a precedent in taxing such loyalty schemes and savvy shoppers could well be next with Multi-buys, cashback credit cards and cashback websites all possible targets in the future.”
So should we all be worried about our clubcard balances? Is the taxman going to be making honey out of your Nectar card? Should you start declaring your Quidco and TopCashback earnings on your tax return? Apparently not. HMRC are reported to have dismissed these claims as “complete rubbish”, and the taxing of additional income on an investment product (i.e. designed to make the holder money) does seem to be entirely different from earning 20p from buying a kettle at Argos.
Still, you can never say never with HMRC, and perhaps the good folks at Hargreaves Lansdown have just given them a great idea for next year’s Budget…
Cashback is a wonderful thing, isnt it? We buy something that we want and we then get a chunk of that cash back to
waste spend on something else.
Those who are familiar with cashback will know that cashback can be claimed for making online purchases at participating retailers but do you know that two of the biggest cashback sites in the UK now offer cashback for grocery purchases made online and also instore? Let me explain…
ClickSnap is the new feature from Quidco which allows you to get money back on your grocery purchases made online or even instore. If you buy an item that is featured in their eligible product list you can claim cashback after making the purchase. To do this you need to snap and upload a photo of your receipt and ClickSnap will automatically review your online order or uploaded receipt and pay you the sum of cashback available for those eligible products.
You can shop at Tesco, Asda, Sainsburys, Ocado, Waitrose and Morrisons but make sure you review the terms for each product as some exclude certain supermarkets and some only include instore purchases.
At the moment ClickSnap is offering a whopping £5 cashback on a 300g box of Ferrero Rocher which might be worth checking out. It is also worth noting that offers can be redeemed up to 3 times instore or online.
The TopCashback equivalent is called Snap & Save and includes the same supermarkets with the addition of The Co-Operative, M&S Food and Iceland.There is a list of eligible offers and details of how much cashback is available for each product.
It seems from the Topcashback website that each item needs to be redeemed individually but you can submit a cashback request on the move via their official app which could make this much easier than having to wait to go home to then scan and upload your receipt. The best offer currently available from Topcashback seems to be (according to its popularity over at HotUKDeals) £2 cashback from a £10 petrol spend.
Is this new cashback initiative something that will make you tailor your shopping list in order to benefit from some money back or do you think it is too much hassle for saving just a few pounds?