Can you buy in-app purchases with itunes giftcard money?

It should be deducted from your account's balance, if there isn't enough on it then the remainder should then be deducted from your credit card.

Deducting from credit card however should be based on "Agree" button and if it is not then the logic is invalid to bank authorization procedure (cannot be implicit and cannot be assumed during account creation when credit card is required in form of general agreement). Financial law is applicable.

I tried it and it worked. It has used my itunes credit for an in-app purchase.

It hasn’t worked for me before so I was sceptical but apple have fixed their bug and it works now within the game I used to make the purchase.

I hope this helps!