Cashback Calculator
Calculate cashback earned on a purchase and the effective final cost after cashback, from a purchase amount and cashback percentage.
$
%
Cashback Earned
$10.00
Effective Cost After Cashback
$490.00
How Cashback Is Calculated
Enter the purchase amount and the cashback percentage offered by your card or rewards program to see how much you'll earn back, and what the purchase effectively costs you after the cashback is applied.
Effective Cost = Purchase Amount − Cashback Earned
Example
A $500 purchase with 2% cashback earns you $10 back, bringing the effective cost of the purchase down to $490. On a card offering 5% cashback in a bonus category, the same purchase would earn $25 back, for an effective cost of $475.
Common Use Cases
- Comparing how much different cashback cards or promotions actually save you.
- Deciding between a cashback offer and a points or miles rewards program.
- Estimating total cashback earned across a month or year of spending.
- Checking whether a cashback rate justifies an annual card fee.
FAQs
Is cashback the same as a discount?
Functionally similar, but cashback is usually paid back after the purchase (as a statement credit, deposit, or points balance), while a discount reduces the price at checkout. The net savings can be the same, but the timing differs.
Is cashback taxable?
In most cases, cashback from personal credit card spending is treated as a rebate or discount rather than taxable income. Cashback earned through referral bonuses or business rewards can sometimes be treated differently — check with a tax professional for your specific situation.
Do cashback rates ever have limits?
Yes — many cards cap bonus-category cashback (e.g., 5% up to $1,500 in spending per quarter) or apply the higher rate only to specific categories, reverting to a lower base rate on everything else. Check your card's terms for spending caps.