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A rebate is similar to a discount in so far as it reduces an amount payable. Sometimes it is used as a synonym for discount in a trading situation. However, a discount is strictly a reduction allowed by the payee, whereas a rebate is an amount returned to the payer – often at a later date. The term rebate is frequently associated with rent and rates, as certain people who are considered to be of limited means are given back portions of rent or rates paid to a local authority. These repayments are known as rent or rate rebates.

Reference: The Penguin Business Dictionary , 3rd edt.