Gifts or payment in kind?


When we deposit our money in a bank and in return we are offered a tablet PC,an ipad or a crockery set, bear in mind they are not gifts. These items represent our remuneration but, instead of in cash, we are receiving a payment in kind.

Can we enjoy these items without having to worry about anything else? Not exactly…

  • Remember that the item you are offered is not a gift, but the remuneration obtained in return for complying with certain conditions. For example, when you are offered a television in return for receiving your wage by direct deposit in your account for 18 months.
  • The credit institution must inform you of the conditions you must comply with because, if you fail to do so, you will be penalised. Continuing with the example mentioned above, if after 12 months you decide to stop receiving your wage by direct deposit, you will have to pay the credit institution the amount established on the contract.
  • The item received is considered as payment in kind for tax purposes. This is, it will be subject to taxation and will therefore have to be included in your income tax declaration. The credit institution will have to inform you of the item’s value and of the withholding tax.


    Don’t get carried away and inform yourself. Compare the item’s value with the remuneration you would obtain with payment in cash.
Did you find this information useful?