Hello peeps, when paying taxes does the ATO charge credit card fees?
What is the best way to use credit and gain credit card points - what cards ie. Mastercard/Visa/Amex ?
Any hacks?
Many thanks.
OzBargain Way to Paying the ATO
Mrfrog on 30/01/2025 - 13:19
Last edited 30/01/2025 - 13:31 by 2 other users
Last edited 30/01/2025 - 13:31 by 2 other users
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I'm surprised they don't consider a Mastercard gift card purchase as a cash advance
Shhhhhhh dont give them ideas!
doesnt coles mastercard gift card charges service fee? If not that would be awesome
It is on no-fee offer like half the year. Search for ‘coles mastercard’ on ozbargain. It is currently without a fee.
iTunes gift cards
They actually called me a few weeks back asking me to pay my outstanding tax bill using iTunes gift cards.
Disability is tax free
They are such nice young men
Me too except I opted to be arrested and jailed. Still waiting for them to come and arrest me.
The ATO currently charges the following payment fees for the following payment methods when paying through the ATO portal on myGov or Government EasyPay:
Card Type Fee American Express 1.45% Mastercard – International 1.99% Mastercard – Domestic Debit 0% Mastercard – Domestic Credit 0.72% Visa – International 1.99% Visa – Domestic Debit 0% Visa – Domestic Credit 0.80% The OzBargain way is to use prepaid gift cards (e.g. Coles Mastercard gift cards, Vanilla Mastercard gift cards, Vanilla Visa gift cards), because those are classified by the ATO as "Domestic Debit" and therefore attract no surcharge. I used a Coles Mastercard gift card to make a payment on the ATO website last night and was charged no surcharge. Have a look at the linked product tags to see past and current sales, as well as get notified for the next sale.
A word of warning though: prepaid gift cards owned/operated by Blackhawk Network (e.g. Activ Visa gift cards) block transactions at the ATO, so do not waste your time with those.
Thanks, this is really useful.
Do people stockpile discounted gift cards for this, or are they readily available at a discount all year round somewhere?
I do not stockpile prepaid gift cards, due to their increased susceptibility to fraudulent transactions (and the hassle associated with disputing transactions).
Discounted prepaid gift cards that can be redeemed at the ATO are not really available all year round, which means you need to keep an eye out for whenever a sale crops up and take advantage of it if you can.
Not sure if it is worth using Coles Mastercard Gift card as I could only find a $250 card with $7 acquisition cost (I could be wrong though). Unless the card can be topped of with a larger amount, I can't see much benefit for the effort. Plus, it will take a number of card if you are required to pay a large amount.
Not sure if it is worth using Coles Mastercard Gift card as I could only find a $250 card with $7 acquisition cost (I could be wrong though).
- The point I was trying to make (and probably should have made more explicit in my prior comment above) is that the OzBargain way is to buy a prepaid gift card through a sale using your credit card, then use that prepaid gift card to make payments at the ATO. That is the reason I wrote in my comment:
-
Have a look at the linked product tags to see past and current sales, as well as get notified for the next sale.
It sounds like you went to a physical Coles store or Shell Coles/Reddy Express to look for Coles Mastercard gift cards. I am not aware of any current sales on Coles Mastercard gift cards at either of those stores, so purchasing one your credit card at the moment makes very little sense considering the $5 or $7 purchase fee.
Here are current and past examples of sales on relevant prepaid gift cards:
No purchase fee on $100 and $250 Coles Mastercard digital gift cards at giftcards.com.au. This has a limit of $2,500 per order, and one order per customer per day. (This would probably the best sale to take advantage of if you have a large ATO debt to pay off.)
2000 bonus Flybuys points on $100 and $250 Coles Mastercard gift cards at Coles. This had a limit of five gift cards per Flybuys account.
10x Everyday Rewards points on $50, $100 and $25-$500 Vanilla Visa gift cards at Woolworths. This had a limit of two $25-$500 load gift cards per Everyday Rewards account per day, and five $50/$100 gift cards per Everyday Rewards account per day.
[VIC, TAS] 10% off $100 and $250 Vanilla Visa gift cards at Coles. This had a limit of five gift cards per Flybuys account per day. This deal usually happens around September (once a year) in VIC and TAS, and around March (once a year) in NSW and ACT.
I cannot guarantee when the next worthwhile sale on prepaid gift cards will happen at a physical store, but if you look at FreePoints' fantastic gift card promotional history page, you can have a go trying to use historical sales (and particularly its frequency) to guess when the next worthwhile sale may happen.
Unless the card can be topped of with a larger amount, I can't see much benefit for the effort. Plus, it will take a number of card if you are required to pay a large amount.
If you cannot see much benefit, then fair enough. I mean, if you have to pay off a $50,000 ATO debt within the next couple of months, "the OzBargain way" (or what I think it is, anyway) is probably not that feasible. However, if your ATO debt is one or two order magnitudes smaller, then it can make some sense to at least pay off part of it using a prepaid gift card purchased through a sale.
I have a CBA Smart Awards credit card and tried to get points on my ATO payment. I would have made a slight profit on the points plus keeping money in my mortgage longer.
Nope, didn't work. I was charged the surcharge but didn't get any points. Only CBA business cards earn points on ATO payments.
there is probably something in the pds that says no points awarded on payments to government agencies
That is the case with most credit cards or you get 0.5 point instead of 1 for government payments. You just pay with gift cards instead to maximise your points earning.
Does it still work to BPay using ZIP, copping the .25% fee and then paying it off with your CC ?
I paid for a whole uni degree with that method and it worked a treat!I did this method for my 2024 Land Tax bill. Hoping it still works for my whopping invoice for 2025, however, I believe others said in other posts that it doesn't work. I'll try soon.
As an aside, my zip limit was $1000 at first, but after a few payments was increased to $1,500. Now they're offering Zip Plus with $8,000 limit. The higher limit would definitely make it easier to pay (with less transactions).
Don’t get Zip Plus. You can’t pay off with CC
Cheers
I just (now) paid a portion of my land tax bill via ZIP and appears to work and without and fees incurred (which has always been my experience with ZIP and this biller)
I am on ZIP Pay with $1500 limit.
But can you pay zip with a credit card with no fee and earn points?
@surfingedge: Yes.
I use ZIP to pay the ATO bill, then my credit card to pay the ZIP bill - no fees are charged. Rinse and repeat until ATO bill has been paid off.
Points are also earned on my CC for paying off the ZIP bill.
What does it take to get your limit increased I wonder? I have asked support a few times and they couldn't even give me a straight answer other than basically use Zip and hope you get it one day…I've been using it as much as possible over the last year and still no increase, it's annoying but just means more transactions to pay the ATO bill.
What did you do to increase your limit? I've been stuck at $500 for 6+ months now!
I think more frequent payments and higher/max amounts? I basically used ZIP to max limit each time and paid off straight away with CC.
After say 15(?) transactions I think I was offered $800 limit, then offered $1000 after another 15, then $1500. Had a quick look at my transaction history and I've done about 150 transactions over that last 12 months.
I use ZIP to pay for any and all bills that have BPAY option AND that which charge transaction fees for CC.
@Porker: They must have something against me, I just double-checked mine and I've been using it constantly since July '24 (102 transactions) and I haven't shifted from $500 limit
I've basically been maxed out the entire time but I haven't been paying off immediately so maybe I'll try that.
@TheFreaK: I used it once with an $800 limit. Didn’t touch it for a year, now I have 1500. Have literally used it twice.
Reading the revenue.nsw.gov.au site now and it says 0% fees for credit card. Am i reading this properly? I thought that was limited to debit cards only. Can someone confirm
https://www.revenue.nsw.gov.au/help-centre/make-a-payment
Go to 'Pay Now', 'Tax and Levies'Please note that a card payment fee of 0% applies to final credit card payments.
Yes, NSW was surcharging illegally so they have removed the fee (for now)
NSW Coalition having an illegal scheme in place? No way.
Go to a foregin hospital take a picture of you in a hospital bed with the word in a coma. send it to ATO for compassion reason.
So then who's been communicating to the ATO?
Spooky
This is why everyone can't have nice things. There's always someone misusing the lack of strict oversight.
Like the failed Albanese and the No vote
There is more waste in contractor spending, big corp oil gas not paying tax…
Best option is if you can buy discounted giftcards
Second best option is use zippay. No fees to bpay and you earn credit card points
Also tried using CC, Qantas Platinum
Thought I'd score $8000 points on my BASNada came through
Is it too ridiculous to get $10000 - $14000 of store prepaid gift cards ?
If you can find that many, and also there is usually a daily limit per colesworth account.
Depends on the maximum capacity of prepayment. If it's $500 that's still 20 to 28 cards
I assume you can make 20 separate payments to the ATO though.
Yes, is that the case with zip pay and prepaid mastercards ? I have a whopper coming up …
You can make as many separate payments as you want to pay off an ATO debt.
When paying through the ATO portal on myGov, you can specify an amount to pay between $1 and $20 million.
When paying through Government EasyPay, you can specify an amount to pay between $10 and $20 million.
I just went to Coles and looked at the Mastercard gift cards, they have a surcharge of $7 for a $250 gift card ie 2.8%, it would be cheaper to just pay the ATO with an Amex, am I missing something?
Woolies monster post suggests some options for fee free cards
Also it seems many CC you won’t get pts if you pay the ato with them but you will if you buy the gift catds
They're fee free online right now
nice man!!!
what's suck is the $250 limit on these card, is there a way you could buy to 10 cards and consolidate the balance into 1 card?
planning to pay my strata fees
The offer for the Coles Mastercard didn't last until the 28th of February as stated in the T&C's, does anyone know of another prepaid option that is free to purchase?
BPAY them
google play gift card
if you pay via your bank app via bpay there is no fee for using the credit card.
Is this for real? Have been paying my quarterly PAYG instalment activity stayements via bpay, but on my PC. Wish I knew early. Will check this out on my next payment.
But check if you're getting the cc points or not
I always assume BPAY is excluded from earning cc points barring a few exceptions some other users might post.
Meh just do EFT if you don't care about the points.
I used to use $995 gift cards to pay my $20k BAS. ATO asked me why I couldn't just pay a larger amount everytime ;)
Now my BAS is 100k so I just use a payment processor and deduct the charges and collect Amex points
@babyTiger: run a small business. selling various electrical & process engineering products & solutions to pharma, mining, F&B, defence etc in AU.
so we import quite a bit and sell it locally so always have a large BAS to pay..
Paying the ATO via BPAY using the CC has 3 advantages
1) no card fees
2) you can get an extra 55 days to pay the tax bill interest free
3) you can use bank's pay in installments feature (i assume most CCs have this now) to spread the tax bill over 3 to 12 months at 4% pa.If the amount owing is large I'd first consider an ATO payment plan, I've done that a few times and they usually want 20% upfront with the remaining 80% spread over 12 monthly installments interest free.
I think the instalments are interest free only if your interest chargeable per month is less than $100.
Anything over $100 and it did not remit the GIC for me.
YMMV
Not sure why nobody has asked this here yet:
Does using many gift cards to pay the ATO possibly get you flagged for fraud? Using stacks of gift cards to pay for something seems like something fraudsters do. Gift cards can be used to launder money. Are the credit card points worth the risk to get that sort of attention from the ATO?Yes
that's why you keep the purchase receipts of the gift cards on record.
Just because you're flagged, doesn't mean you did something illegal. As long as you're not actually committing fraud.
Just keep (a scan of) all the colesworth receipts
I guess this wouldnt work if the receipts all showed paid in cash?
Anyone have any experience with this triggering an audit ?
there a way I could buy to 10 cards and consolidate the balance into 1 card?
planning to pay my strata fees since they dont take AMEX
Just ask your Strata to process the smaller payments manually?
Anyone found another free prepaid card we can use? the Coles Mastercard offer is expired
I'm looking too. The fee free cards deal was supposed to expire 28/02, which is when my quarterly tax bill was due. I was going to organise the cards beginning of next week, stuck dead in the water now :(
Use Bpay - avoid any surcharge - either from your bank account or a credit card if it allows BPAY
Coles Mastercard gift card, purchase them with Amex Plat Edge and you get 3 pts per dollar fee free.