How to Pay Your Tax Bill by Credit Card Payment

Posted May 25th, 2010 and last modified January 7th, 2014
Paying your taxes via credit card can be as easy as one, two, three. Know the requirements and fees to see how the system works. Paying your taxes via credit card can be as easy as one, two, three. Know the requirements and fees to see how the system works.

Tax time is always crunch time. Not everyone is organized when it comes to paying their taxes, and many are often putting it off until the very last minute. Then they have to endure long lines, long wait times and other hassles that come with paying your taxes.

The Australian Taxation Office is the Government’s principle tax collection agency. It is part of the Treasurer’s portfolio and aims to help manage taxes that fund services for the country’s citizens.

In February 2009, the ATO offered a service where tax payers can make payments online with the use of their credit card. With the launch of this service, it became more convenient for citizens to pay their dues so long as they have an Internet connection. Conditions do apply.

What do I need?

Before using the service, you need to know the three requirements for the online payment.

First, taxpayers must have an active and current Visa, MasterCard or American Express card. The service itself is free, but note that charges to your credit card will apply. According to the Australian Tax Office (ATO) website, card payment fees are 0.42% for Visa and MasterCard, while it’s 1.45% for American Express. These fees are the not subject to the goods and service tax or GST, and is equivalent to the fee the ATO gets from its banker. Before confirming your payment, the website will inform you of the total transaction fees.

Second, taxpayers must have the ATO electronic funds transfer (EFT) code. The EFT code is also known as the payment reference number (PRN) and is printed directly above the bar code of the payment slip. It’s important to have this number on hand when paying through credit card.

Lastly, taxpayers need to use the Government EasyPay website or telephone service when transacting. The website is secure and provided by the ATO and the Reserve Bank of Australia using the Optus SmartPay system.

Credit card payments can also be done over the telephone. The service is also provided by the Government EasyPay and is a self-help telephone service. Have your EFT code/PRN and credit card details handy when calling 1300-898-089 to make the payment. Tax payments between $10 up to $50,000 is accepted.

Note that all payments must be received by the Tax Office on or before the deadline. Transactions done beyond the regular office hours or after 6:00 PM Sydney time will be processed on the succeeding business day. The same goes for transactions received during weekends or holidays. These should be taken into consideration when paying especially when it’s close to the deadline. Late payment may be subject to penalty fees.

After the tax bill payment has been made, a receipt containing all the details of the transaction will be issued. It includes the tax payment as well as the card payment fee. These will be displayed as “ATO payment” and the “Card payment fee – ATO” on your card statement.

Tax Deduction

It is also possible to claim the card payment fee as a tax deduction. This is depended on several conditions, of which includes the following: The type of card used (Visa, MasterCard, American Express); the type of liability/tax being paid and the type of amount to be paid (if it’s using a credit account or is paid through debit).

The ATO website lists more details when filing for a tax deduction.

Other Payment Options

The ATO has other options for tax payment.

  • BPAY – BPAY is a third-party service launched in 1997 has been widely adopted throughout the banking sector. It provides a secure, electronic bills-payment system directly from your cheque or savings account using your financial institution’s phone or Internet banking service.
  • Direct credit allows you to transfer payment through online from a cheque or savings account.
  • Direct debit – Payment is automatically deducted from your cheque or savings account.
  • Mail – Payment is made by sending the payment slip with a cheque or money order through the postal system.

Paying from Overseas

The online and telephone payment options are also available to Australian residents who are overseas. Note that you will need an Australian bank account to make the payment from its cheque or savings. You may also want to consider the time difference so as not to have problems when making payment. The rules and conditions still apply.

With these available payment options, combined with early or on-time payment, tax time may be crunch time, but it is not as stressful.

Was this content helpful to you? No  Yes

Ask a Question

Disclaimer: At finder.com.au we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to receive follow up emails related to finder.com.au and to create a user account where further replies to your questions will be sent.

10 Responses to How to Pay Your Tax Bill by Credit Card Payment

  1. Default Gravatar
    Terry | November 25, 2013

    Hi. I want to pay my tax approx. $40,000 in total using my Platinum American Express Card. On the ATO website it says the rate is 1.45%. Does this mean I pay the ATO 1.45% plus an AMEX charge or does it mean I pay just the 1.45% to AMEX as my monthly charge. Please clarify my surcharges for using American Express.
    Thanks.
    Terry.

  2. Default Gravatar
    Anne | July 29, 2013

    Hello,

    Which banks issue reward points for credit card payments to the ATO for BAS, Income Tax etc. payments?

  3. Default Gravatar
    Adam | May 6, 2013

    Hello,

    I wish to make a tax payment via credit card, but the amount is higher than my credit limit.

    Is it possible to pay half the tax amount on credit card, then transfer money back to credit card so i can make the second payment?

    Or do i have the make the tax payment in one payment?

    • Staff
      Jacob | May 6, 2013

      Hi Adam. I believe it comes down to paying the full amount before the due date. I’m just confirming this with the tax office. I will reply to this message as soon as I know. Jacob.

    • Staff
      Jacob | May 7, 2013

      Hi Adam. Just had a chat with the ATO. If you’re using a payment slip, you can keep making payments up till the due date, you don’t have to pay it all in one lump sum. Jacob.

    • Default Gravatar
      Adam | May 7, 2013

      Hi Jacob,

      Thanks so much for your reply, much appreciated.

  4. Default Gravatar
    Henrik | April 25, 2013

    Commonwealth Bank excludes payment of ATO PAYG from counting towards awards points. Are there any banks that will give you awards points if you pay your tax bill with the ATO using their credit card ?

    • Staff
      Jacob | April 26, 2013

      Hi Henrick. Thanks for your question. American Express Membership Rewards points will allow you to earn points when you pay utility bills. You can compare their credit cards here. Jacob.

Subscribe to our newsletter and get "The Ultimate Guide to Balance Transfers"

If You Like This Post...

Get all the latest deals, guides and tips in Finder's free bi-monthly email. Don't miss out - join the thousands who get it emailed!

We Respect Your Privacy

Credit Cards Comparison

Interest rate (p.a.) Balance transfer rate (p.a.) Annual fee Cash advance rate (p.a.)
American Express Qantas Discovery Card
American Express Qantas Discovery Card
Benefit from not ever having to pay an annual fee. Plus earn 1 Qantas Point per $1 spent on all your everyday purchases. 20.74% p.a. 0.99% p.a. for 6 months with 1% balance transfer fee $0 p.a. Apply Now For The American Express Qantas Discovery Card
Read More About The American Express Qantas Discovery Card
Westpac Low Rate Card
Westpac Low Rate Card
A low interest rate credit card with a low annual fee and long term balance transfer offer. 13.49% p.a. 0% p.a. for 14 months $45 p.a. 21.49% p.a. Apply Now For The Westpac Low Rate Card
Read More About The Westpac Low Rate Card
St.George Vertigo MasterCard
St.George Vertigo MasterCard
A low balance transfer rate and ongoing purchase rate. 13.24% p.a. 0% p.a. for 14 months $55 p.a. 21.49% p.a. Apply Now For The St.George Vertigo MasterCard
Read More About The St.George Vertigo MasterCard
Bankwest Breeze MasterCard
Bankwest Breeze MasterCard
Low ongoing purchase rate from Bankwest, with an introductory rate on balance transfers. 11.99% p.a. 0% p.a. for 13 months $59 p.a. 21.99% p.a. Apply Now For The Bankwest Breeze MasterCard
Read More About The Bankwest Breeze MasterCard
Citibank Clear Platinum Card
Citibank Clear Platinum Card
Low rate credit card offer with a low balance transfer rate. Also comes with platinum privileges and benefits. 12.99% p.a. 0% p.a. for 12 months $49 p.a. annual fee for the first year ($99 p.a. thereafter) 21.74% p.a. Apply Now For The Citibank Clear Platinum Card
Read More About The Citibank Clear Platinum Card

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

Ask a question