Cashback Calculator

Written byOleh Soloninupdated 5 October 2026

Currency

What to work out

Purchase amount

Cashback, %

Advanced options

Value of rewards per 1 of face value

If rewards redeem for less than face value, such as 80 in gift cards for every 100 earned, enter 0.8. For cash back, leave at 1.

Result

Cashback on the purchase

$6.00

Price after cashback

$114.00

Working

Cashback = 120 × 5% = 6 Price after cashback = 120 − 6 = 114

Cashback on this purchase at other rates

     Rate        Back        Net price
       1%        1.20           118.80
       2%        2.40           117.60
       3%        3.60           116.40
>      5%           6              114
      10%          12              108
      15%          18              102

This result is informational only and is not professional advice.

Cash back on one purchase, and what a card really returns in a month

Work out cash back on a purchase from the rate, or a rewards card's net cashback over a month with bonus categories, a cap, a card fee and points: where the cap kicks in, the effective rate and how it compares with a flat no-fee card.

Cash back is the part of a purchase price that a card or a store pays back afterwards, as money or as points. To work it out, multiply the amount by the rate: 5% back on a 120 purchase is 6, so the purchase really costs 114. The purchase mode does this in one step and shows what other rates would return.

The card mode shows what a rewards card is really worth: a base rate on everyday spending, a bonus rate on categories, a cap, a card fee and the value of points. It finds where the cap kicks in, how much it cuts and the effective rate across everything you spend.

How to use

Choose between cash back on one purchase and a card over a month.
For a purchase, enter the amount and the rate. For a card, enter spending at the base and bonus rates, the kind of cap and its size, and any card fee.
If rewards are worth less than face value, set their value in the extra settings; you can also compare the card with a no-fee card there.
Read the cash back, the Working lines and the table: by rate for a purchase, by category spending for a card.

How to calculate cash back

Cash back = purchase amount × rate ÷ 100. On a 120 purchase at 5%, you get 120 × 5 ÷ 100 = 6 back, and the price after cash back is 120 − 6 = 114. In money terms 5% cash back is the same as 5% off, but a discount lowers the price at the till, while cash back arrives after the purchase, when the card's terms say.

Worked out with this calculator.
Rate	Back on 120	Price after cash back
1%	1.20	118.80
2%	2.40	117.60
3%	3.60	116.40
5%	6	114
10%	12	108
15%	18	102

A card's effective rate

The bonus rate only covers category spending; everything else earns the base rate. The effective rate is net cashback divided by everything you spent. Take 1,500 of everyday spending at 1% and 600 in bonus categories at 5%, where the bonus rate only applies to the first 500: the card returns 15 + 500 × 5% + 100 × 1% = 41, an effective rate of 41 ÷ 2,100 × 100 = 1.95%, not 5%.

Where the cap kicks in

Cards cap rewards in different ways, and the calculator handles three: a cap on all cashback in a month, a cap on bonus cashback only, and a cap on the spending that earns the bonus rate. With a spending cap, category spending above it earns the base rate, so the effective rate falls as you spend more:

Everyday spending 1,500 at 1%, 5% on the first 500 of category spending, no fee. Worked out with this calculator.
Category spending	Net cashback	Cut by the cap	Effective rate
300	30	0	1.67%
500	40	0	2%
600	41	4	1.95%
1,200	47	28	1.74%
2,400	59	76	1.51%

When the cap is on the cashback itself

If a card caps all cashback in a month, base cashback uses up the cap too. The category spending that reaches it is (cap − base cashback) ÷ bonus rate: with 15 of base cashback, a 50 cap and a 5% bonus rate, that is (50 − 15) ÷ 0.05 = 700. Beyond that point nothing more accrues. The card's rewards terms say which kind of cap applies.

Is a card with a fee worth it?

Take the fee off the cashback left after the cap, then compare with what a flat no-fee card would return on the same spending. The card above returns 41 a month; with an 8-a-month fee that leaves 33. A no-fee card paying 2% on everything would return 2,100 × 2% = 42, so it comes out 9 a month ahead. For an annual fee, divide it by 12.

Valuing points

If rewards redeem for less than face value, their worth is what you can actually get for them. If every 100 of rewards buys 80 in gift cards, set the value to 0.8: 5% on a 120 purchase is 6 at face value but worth 4.80, which is 4% rather than 5%.

What this calculator shows

Cash back on a purchase and the price after it
Cash back on the same purchase at other rates
A card's net cashback for the month and the year
Where the cap kicks in and how much it cuts
The effective rate across all spending
A comparison with a no-fee card, and points valued in money

What to keep in mind

The rate applies to the whole purchase; each programme's rounding rules and excluded purchases are not included.
A cap is in the same units as the rewards; rewards are valued after the cap, and the fee comes off last.
The no-fee card in the comparison pays one rate on everything, with no cap.
Tax is not included. In Russia, card cashback under loyalty programmes is exempt from income tax under Tax Code article 217(68); other countries have their own rules.

Where the numbers come from

Checked against the percentage formula; for Russia, Tax Code article 217(68) on loyalty-programme income · verified September 2026.

FAQs

How do you calculate cash back?

Multiply the purchase by the rate and divide by 100: 5% back on 120 is 6, so the purchase costs 114 after cash back.

Is cash back the same as a discount?

In money terms 5% cash back equals 5% off. The difference is timing and form: a discount lowers the price at the till, while cash back is paid afterwards, as money or points worth what they redeem for.

Why is my effective rate lower than the advertised rate?

The bonus rate covers only category spending, the rest earns the base rate, and a cap cuts the top. With 1,500 at 1% and 600 at 5% capped at 500 of spending, the card returns 41, or 1.95% of 2,100.

When will I hit my cashback cap?

For a cap on all cashback, at (cap − base cashback) ÷ bonus rate of category spending: with 15 of base cashback, a 50 cap and 5%, that is 700. For a spending cap, at the cap itself.

Is a card with an annual fee worth it?

Only if its net cashback after the cap and the fee beats a no-fee card on the same spending. In the example, an 8-a-month fee leaves 33, while a flat 2% no-fee card would return 42.

How do I value points or miles?

By what they redeem for. If 100 of rewards buys 80 in gift cards, enter 0.8: 6 at face value is worth 4.80.

Is cashback taxable?

The calculator does not include tax. In Russia, cashback under card loyalty programmes is exempt from income tax under Tax Code article 217(68); other countries have their own rules.

Worked example

A card with a bonus spending cap

Input: 1,500 everyday at 1%, 600 in bonus categories at 5% on the first 500

Output: 41 a month, an effective rate of 1.95%

Note: The cap cuts 4. With an 8-a-month fee, a flat 2% no-fee card would be 9 a month ahead.

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