AmEx Qantas Discovery - Change to Earn for Spend on Government Bodies on 1 June 2017

bluesky on 03/03/2017 - 17:05
Last edited 03/03/2017 - 17:07

Just received a letter from Amex about this.

From 1 of June 2017 you will earn 0.5 Qantas Points per $1 spent at government bodies in Australia, including Australia Post and the Australian Tax Office.

Your other earn rates remain unchanged, so you'll continue to earn:
· 1 Qantas Point per $1 spent on all other purchases
· 1 additional Qantas Point per $1 spent on selected Qantas products and services in Australia

At the moment, earn rate for government bodies is the same as any normal purchases, i.e. 1 point per $. So, the earn rate is essentially halved.

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Comments

  • [Deactivated] on 03/03/2017 - 17:49
    -4

    Big deal.
    Besides, if you're using Amex at AP (or god forbid paying Govt bills and copping the stupid surcharges) then you need some hardcore training on how to use a CC.

    • bluesky on 03/03/2017 - 18:17

      Had it stayed at 1point/$ and not downgraded, in some circumstances, paying govt bills, even with surcharge, could still be relevant. People often value qantas points at 1c/$. The ATO surcharge is 1.45%.

      Take the example of someone who is just a bit short of points, but wish to redeem a trip soon. S/he may decide to pay some of the tax bill to reach the target, even with the 1.45% surcharge. This surcharge itself is tax-deductible, so depending on applicable tax rate, one might get back 30% or even 50% of it anyway.

      So, the drop in earn rate may have relevance to people making such decisions.

      BTW I did not neg you; I can see where you are coming from, i.e. generally-speaking, you would not pay 1.45% surcharge to get 1 point/$.

  • Findo on 04/03/2017 - 21:13

    Is it better to opt in to PAYG or rack up tax owed and pay back later?

    • bluesky on 05/03/2017 - 00:33

      Even if you do not choose automatic entry into PAYG, you can only rack up tax owed for first year. Soon as your next tax return shows that your income for the last year is above the threshold, ATO will write to you to enter PAYG. So you won't have the option for long. As for the first year, it is up to you whether you want to earn some interest with the money in the meantime. But if you do, best to make sure the amount is set aside to pay the tax later.

      • Findo on 05/03/2017 - 01:13

        Thanks for that. PAYG was set up by my employer and I've always posted a surplus tax refund when it came to tax return time. How can I owe the ATO taxes so I can earn points?

        • bluesky on 05/03/2017 - 01:44

          I made the assumption you are self-employed or an independent contractor when you initially asked about opt-in to PAYG.

          But even those who have PAYG deducted from work, can enter PAYG, if they have investment and other sources of income, and wish to pay this on a PAYG basis.

          So far as I know, ATO is generally fine if you overpay tax, and get it back as refund later. But since you are already getting tax refunds, to prepay even more to earn points sounds like too much trouble. Besides, you will have to do the cost-benefit analysis of this. Bear in mind, you will forego the interest you might earn, if you keep the money in the bank. There are also surcharges, and the earn rates are going down (as this post demonstates).

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