rebates
Definition
A rebate is a partial refund that a seller gives back to a buyer after the buyer has already paid the full price for something. Businesses use rebates as a marketing tool to attract customers while still collecting the full price upfront, with the refund coming later through a separate process.
Example
You buy $500 worth of office supplies from a vendor, and they promise to send you a $50 check back after you mail in your receipt, which is a classic rebate arrangement.
Watch Out
Some industries have strict laws governing how rebates can be offered, particularly in healthcare and insurance, where certain rebate arrangements can actually be considered illegal kickbacks.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.