Benefits & Drawbacks of Utilizing CC to Purchase Gift Cards for Utility Bill Payments 🌟💳🏠💰

[varunsridharan]

I've been actively researching this forum for an extended period to understand the potential drawbacks of buying gift cards with a credit card and subsequently using those gift cards to cover my monthly utility expenses.

I've been employing this method for four months now, where I purchase Amazon gift cards worth ₹20,000 using my SBI Cashback card from Amazon and use them to settle my bills.

However, I recently discovered that there are limitations on the maximum amount of Amazon gift cards I can acquire from Amazon.

Additionally, I'm uncertain about the potential tax-related issues that may arise.

Any clarification on these matters would be greatly appreciated. Furthermore, I'd like to know if you can suggest alternative sources for purchasing additional Amazon gift cards using the SBI Cashback credit card.

Is it acceptable to load a substantial amount, such as ₹30,000 or ₹40,000, into my Amazon wallet in a single day using gift cards?

Your insights and guidance would be immensely helpful.

 

[helloworld]

According to me, Gift cards or Purchasing Items or Paying Bills all are related to your spends only. Think of one cumulated category called 'spend'. Doesn't matter you loaded to wallet or purchased gift vouchers or purchased Car.

Income tax issue comes, when your income < spends, then you have to justify "how you're able to purchase when your income low", otherwise its not an issue. Whatever you earned, you spent.

Credit cards reports when you spend 10L in a year (not a strict number but on paper, they can report even for 1L if they want) to Incometax dept, where they will check w.r.t your income and apply 2nd point above.

Now, other than Incometax, you also have to deal with bank, app because they sometimes consider it as a MS and violation of product features benefit. So, moderate usage never triggers these but if limit crossed they can also ask for explanation (personal or business).

Amzn limits kept by Amzn to prevent misuse and support personal spends (if you check the limits those are suitable to atleast 90% normal households) but these limits are when you purchase through Amzn, other places you can purchase as per their limits.

Loading, depends on KYC you can load certain allowed limit. That they verified and allowed you to top-up any time (its completed), so feel free to use, there is no issue here. After 1L they won't allow, in future if they see any misuse they can reduce it, but for now that is what they allowed you to load. Again total spends point of view, w.r.t income things will change accordingly. As long as you maintain reported income > spends, no issues.

Terms and Conditions: Amazon Pay Gift Cards issued by Pine Labs - Amazon Customer Service