ATO (tax office) payments by credit card

[Pukka]

I read today that the ATO are considering putting slow payers and non payers into the credit reporting system.
Unfortunately that would affect at least one million of our citizens who would then have trouble getting credit. There appears to be about 20 billion overdue.
Now that dwarfs my numbers and I pay a few days early.

Surely that would be counter productive for them. I'm sure they are very happy to transfer debt collection to credit card companies. Why would they want to make it harder for people to obtain credit cards (which enable them to pay the ATO) ? Sounds like biting the hand that feeds to me. If they did that surely their overdue tax would increase significantly.

I'm happy to accept credit cards in our business as I know I have the cash when they walk out the door. I'd rather have that than a potential bouncy cheque

Or am I using too much common sense here.

 

[ComeFlyWithMe]

Surely that would be counter productive for them. I'm sure they are very happy to transfer debt collection to credit card companies. Why would they want to make it harder for people to obtain credit cards (which enable them to pay the ATO) ? Sounds like biting the hand that feeds to me. If they did that surely their overdue tax would increase significantly.

I'm happy to accept credit cards in our business as I know I have the cash when they walk out the door. I'd rather have that than a potential bouncy cheque

Or am I using too much common sense here.

We offer it for that reason but our volume is so low we get slogged for it, so we have to pass on the fee, which means our volume gets even lower...

Agree it would not be in ATO's interest to report 5 days as a bad debt. Maybe after a few months perhaps.

 

[burmans]

Legislation changed yesterday to just 5 days.

Actually it's the CR Code not the Privacy Act which states this and yes I know I posted the bit of the code post #2915. If you really believe it's the legislation here's the link to the legislation here, have a read and tell me where you think it is 5 days in the legislation

Privacy Amendment (Enhancing Privacy Protection) Act 2012

Good luck with that, I've been working on a Privacy Act project for the last 18 months so I have actually read the legislation! Oh and just to be really pedantic the legislation was passed on 12th December 2013, what happened 2 days ago (not yesterday) was the commencement date.

But it seems you somewhat missed my point. the Act and the Code provides the ability to contribute a whole heap of information, including the fact that people pay their bills on time. Some of this is good information (will help you get credit), some is bad and a fair bit is really somewhere in between.

 

[prozac]

Actually it's the CR Code not the Privacy Act which states this and yes I know I posted the bit of the code post #2915. If you really believe it's the legislation here's the link to the legislation here, have a read and tell me where you think it is 5 days in the legislation

Privacy Amendment (Enhancing Privacy Protection) Act 2012

Good luck with that, I've been working on a Privacy Act project for the last 18 months so I have actually read the legislation! Oh and just to be really pedantic the legislation was passed on 12th December 2013, what happened 2 days ago (not yesterday) was the commencement date.

But it seems you somewhat missed my point. the Act and the Code provides the ability to contribute a whole heap of information, including the fact that people pay their bills on time. Some of this is good information (will help you get credit), some is bad and a fair bit is really somewhere in between.

2 days, one day, so what. There is now a legal obligation for banks to report any late payments beyond 5 days.

 

[burmans]

2 days, one day, so what. There is now a legal obligation for banks to report any late payments beyond 5 days.

Boy, you will persist in misrepresenting things, wont you. Actually the law allows banks to report late payments, it does not oblige them.

And this still ignores my point, by the industries own bodies stats some 70% of people dont pay bills from time to time. The banks perform risk analysis against those customers and it's not the people who are $5 overdue and 5 days behind occassionally wont be the people they wont lend to becauise ten they would be losing more than half their custoemrs.

 

[woodborer]

2 days, one day, so what. There is now a legal obligation for banks to report any late payments beyond 5 days.

Not on my reading. A late payment might be recorded after 5 days. But that is not a default. That cannot happen until 60 days....

 

[cove]

Last night I loaded 5 credit cards with ATO payments and all those taxes are now paid for February a week early.
I used to worry about paying early but after 4 years I just get it all done in record time and it has been pretty easy.
I noticed the points warehouses have been growing but I don't need the points in Velocity nor Kris Flyer at the moment.

 

[prozac]

Not on my reading. A late payment might be recorded after 5 days. But that is not a default. That cannot happen until 60 days....

This is very big news that no one really knows about. So from March this year, if you are later than five days on your payments, you will get a black mark on your credit record, but get this, it is retrospective to December 2012. There are some really big issues here about proper communication and who in fact you are trying to protect.

Alex Malley - CEO of CPA

CPA Australia - Alex Malley on Today on Saturday

edit: I won't be mentioning this again as it is OT and maybe deserves it's own thread. There is no clarity on how many black marks are required to trigger an event.

 

[burmans]

Alex Malley - CEO of CPA

CPA Australia - Alex Malley on Today on Saturday

edit: I won't be mentioning this again as it is OT and maybe deserves it's own thread. There is no clarity on how many black marks are required to trigger an event.

Yes agreed it needs it's own thread, there is a fair bit of misinformation/misunderstanding on this issue, not least because the goverment refused to put any money into an information campaign. Industry do have a website at Credit Smart

I appreciate there may be some mistrust of industry in this space but the reality was it was the government who told them they have the job of doing this and I think they have done a reasonable job. The only other real resource avaialble is the OAIC's own website (click on the privacy tab).

On the question of being retrospective, this is in theory correct but omits a key fact, they cant disclose RHI until they notify customers. You will have seen a recent flurry of such notices from existing credit providers. I can pretty much guarantee this backdating is not going to happen accross industry, in fact many credit providers wont be contributing in 6 months. NZ went through the same exercise 2 years ago and only now are credit providers starting to contribute. Don't believe me, well you are entitled to a copy of your own credit file free once a year, pull your own credit file now or in a few months and see how must historical information is on it, do it now and you'll find none or next to none.

On the last comment that there is no clarity on how many back marks trigger an event, can only agree with this though there is a desire to change this. From a bureau point of view they want to make money out of it (not sure this is great from a consumer point of view). Hopefully OZ will go the same way as the US where people do actually understand and monitor their FICO score (and the factors that influence). One would suggest thats a while off given the current understanding of how credit scoring occurs.

 

[burmans]

Surely that would be counter productive for them. I'm sure they are very happy to transfer debt collection to credit card companies. Why would they want to make it harder for people to obtain credit cards (which enable them to pay the ATO) ? Sounds like biting the hand that feeds to me. If they did that surely their overdue tax would increase significantly.

Its a bit like refereeing sport, its the threat of lodgement that is used to encourage payment. But you do need to penalise people sometimes (i.e. lodge the default) otherwise people think its an empty threat.

Not being able to lend more money is a pretty strong motivator to some people to actually either not have the default in the first place or clear it (pay it off) should it have been lodged.

 

[Nizar]

Geez, in the real world receiving payment anything under 30-60 days late - is classed as on-time!

Lol tell me about it, especially when dealing with government :evil:

 

[drross]

Section 8.1 of the Credit Report Code, note some may apply a higher number of grace days (the below is a minimum, not a required no)

the grace period allowed by the CP for an overdue payment must be at least 5 days, beginning on the date that the CP's systems first classified the payment as being in arrears.

thanks very much

 

[BillytheFIsh]

Hi folks. (Long time listener, first time caller etc etc.)

I've been playing the ATO credit card points game for a while now earning QFF points, but I have enough of those for the moment, so looking to expand into VA/KF points earn.

I'm currently in the process of acquiring an Altitude Black and will probably use the Amex at 1.45% most of the time (at least initially) to kick start my points in those programs, but it is correct to say that the Altitude MC @ 0.625 net points into VA & SQ is the best Visa/MC earn rate on those programs now that Citi has pulled the pin? I've read through most of this thread in the last few months, but there doesn't seem to be a WWEDR equivalent for these programs.

If so, it seems the best option for me will be to go Alt Black Amex when I need max points and WWEDR (within limits - I also have an old old ANZ Visa QFF points plan that gives me 1pt/$ up to a limit and Mrs Fish has a Macquarie Visa Plat) when I want to minimise the surcharge and keep earning into QFF. Maybe use the Alt Black MC if I've got much more than enough in QFF and don't want to pay the 1.45%.

Anyone have any other ideas?

 

[penegal]

Citi was fantastic for SQ KF points, alas no more...

The Westpac SQ co-brand is still a very solid product IMHO, but less attractive for ATO spend given the higher AmEx fee. Pity they dropped the visa to 0.5 pts

 

[prozac]

I recently paid ATO using Westpac Altitude Black Amex. The cost at 1.45% works back to 0.953 cents/point of for a return of 1.5 true points (3 Altitude points).
Payed land tax more recently using the Altitude Black MC. The cost at 0.43% comes out at 0.688 cents/point for a return of 0.625pts as you describe. The Black MC is the better way to pay imo.

 

[kkl]

Seems like the best way to earn points for SQ/CX from the ATO is the WESTPAC Black Alt amex card? Have read through the forums and trying to determine which is best

 

[burmans]

Seems like the best way to earn points for SQ/CX from the ATO is the WESTPAC Black Alt amex card? Have read through the forums and trying to determine which is best

This has been discussed a number of times and really depends on a) can you deduct the card fee (i.e. are you a business or an individual) and (b) how do you value points. If tax deductable some still prefer the WBC SQ Amex over the MC.

 

[prozac]

Seems like the best way to earn points for SQ/CX from the ATO is the WESTPAC Black Alt amex card? Have read through the forums and trying to determine which is best

More points but higher cost than the combined MC. I am happy for the resident ATO card experts to tell me I should be using the Alt Amex instead of Altitude MC.
I suppose it depends on whether you are willing to pay a little more for the points to benefit from 2.4 times more points earn...

 

[kkl]

This has been discussed a number of times and really depends on a) can you deduct the card fee (i.e. are you a business or an individual) and (b) how do you value points. If tax deductable some still prefer the WBC SQ Amex over the MC.

In the process of buying a business, and currently looking for the best credit cards to maximize points

 

[legroom]

I recently paid ATO using Westpac Altitude Black Amex. The cost at 1.45% works back to 0.953 cents/point of for a return of 1.5 true points (3 Altitude points).
Payed land tax more recently using the Altitude Black MC. The cost at 0.43% comes out at 0.688 cents/point for a return of 0.625pts as you describe. The Black MC is the better way to pay imo.

I am guessing you are not from NSW !

Only Visa or MC is accepted here.