ATO (tax office) payments by credit card

[cove]

Only the price of two First class long hauls can get you two numbers in front of two commas in the way of points.
I was only using my right hand so I ran short of fingers!
Thank you ATO. wafliron thank you for checking my fine finger work.

 

[New Chump]

[SUP]*[/SUP] I actually do have a CBA Diamonds Awards Amex card (fee-free for first year) that currently earns 2 QFF pts/$1 because of a bonus they offered me (normally 1.5pts/$1), but it's going in the bin once the bonus runs out unless they completely waive the upcoming annual fee.

Don't do it. The CBA Diamonds Awards Amex card can be the most cost-effective card to pay your tax on: provided you use the Great Rate option hidden in CBA's T&Cs. You can Great Rate 6 transactions per year, which means you pay 0.99% on the item purchased for 3 months (usually you get this rate for a bit longer until the end of the relevant billing period), after which it reverts to the usual extortionate credit card rate.

You need to pay the Great Rate-d tax payment off the card in full just before the Great Rate period ends (ie 3 months or a bit longer after the tax is paid), so you only ever pay interest at 0.99% pa.

So on my spreadsheet (clearly we all seem to have one), making a $50k tax payment on CBA Diamonds Awards Amex card is better value than Citi Select. The interest saving on keeping your 50k in your mortgage for 3 months+ and paying just 0.99% for the 3 months+ PLUS the value of 75,000 QFF points (even if valued at 1c per point), on my calculations is higher than the difference between the higher Diamonds Awards Amex 1.25% fee and the lower visa/mastercard 0.48% fee (eg Citi Select).

Hope that makes sense. Explaining succinctly without my spreadsheet is not easy.

NC

 

[wafliron]

I was only using my right hand so I ran short of fingers!

That's what your toes are for... ;-)

Don't do it. The CBA Diamonds Awards Amex card can be the most cost-effective card to pay your tax on: provided you use the Great Rate option hidden in CBA's T&Cs. You can Great Rate 6 transactions per year, which means you pay 0.99% on the item purchased for 3 months (usually you get this rate for a bit longer until the end of the relevant billing period), after which it reverts to the usual extortionate credit card rate.

You need to pay the Great Rate-d tax payment off the card in full just before the Great Rate period ends (ie 3 months or a bit longer after the tax is paid), so you only ever pay interest at 0.99% pa.

So on my spreadsheet (clearly we all seem to have one), making a $50k tax payment on CBA Diamonds Awards Amex card is better value than Citi Select. The interest saving on keeping your 50k in your mortgage for 3 months+ and paying just 0.99% for the 3 months+ PLUS the value of 75,000 QFF points (even if valued at 1c per point), on my calculations is higher than the difference between the higher Diamonds Awards Amex 1.25% fee and the lower visa/mastercard 0.48% fee (eg Citi Select).

Interesting, thanks for posting that New Chump, I had no idea about the "Great Rate" option available on this card. How do you activate the "Great Rate" for a particular transaction? Call them?

I certainly see and agree with your logic too, although it's not quite as simple as that I think (i.e. there are some other considerations):
- doing what you suggest "locks up" the credit limit for 3 months, which may force you to prepay money into other cards in months 2 and 3, and means you can't earn any more points via the CBA Diamond card for 3 months.
- you'd need to figure out if the interest saved actually offsets the annual fee, which is pretty hefty

Both are YMMV-style considerations of course, but I think in my particular card the above two mean it's still not worth me keeping the card.

 

[kennyboi]

I just applied for the Jetstar platinum which I need to put $5000 on to get bonus 10k points.

I have a tax bill for $4000. Can I please check if paying by card on the ATO bill is considered a purchase and not cash advance?

Also, the surcharge would be around $20. Will I be paying $4020 this time or will the surcharge go onto the next bill?

Thanks

 

[DeKa]

I just applied for the Jetstar platinum which I need to put $5000 on to get bonus 10k points.

I have a tax bill for $4000. Can I please check if paying by card on the ATO bill is considered a purchase and not cash advance?

Also, the surcharge would be around $20. Will I be paying $4020 this time or will the surcharge go onto the next bill?

Thanks

The ATO bills you the surcharge, so the surcharge will be the same day as the "purchase" transaction. ATO payments are not seen as cash advances.

 

[cove]

If all goes well you will get either 4,000 points or 4,019 points.
Do not make the ATO your first and only charge on your account as you do not need someone to look at your new account unnecessarily when you are just starting with them.

 

[Pushka]

And make sure you use the ATO portal when using a credit card. If you use normal internet banking and pay as a Bpay then it is a cash deduction

 

[scheps]

just a side question, the payment limit is capped at 50k, so it says on the website. But that is per transaction isnt it? Is there a limit to how many transactions per day?

 

[cove]

On each phone call you can pay 5 lots of $50,000 then redial and so on until you run out of taxes to pay or until all your credit cards are fully loaded. Basically no day limit applies.

 

[Pushka]

Hi Cove, a question. We have our Company Income Tax form, and it specifically states: in bold, "Payments cannot be made by credit card, or in person at any Tax Office or Branch". Is that for real?

 

[cove]

Ignore that old stationery. If you have a PRN or an EFT you can go for it.
Which one is on your Company assessment?

 

[serfty]

Hi Cove, a question. We have our Company Income Tax form, and it specifically states: in bold, "Payments cannot be made by credit card, or in person at any Tax Office or Branch". Is that for real?

It is mentioned up thread.

From what I can tell, none of the remittance documentation mention the ability to pay by CC and, as in the case you cite, specifically state it can't be done.

Well - it can indeed be done - despite what those documents indicate.

Ignore that old stationery. If you have a PRN or an EFT you can go for it.
Which one is on your Company assessment?

It's not "old stationary". Some weeks ago it was blank paper - the ATO computers print that text on the forms.

 

[PLANT]

PUSHA: by credit card, or in person at any Tax Office or 'SHOPFRONT"....We do it electronically...not in person or at any building......PLEASE LOOK AT WEBSITE THAT ATO.GOV.AU that clearly states you can PAY BY CREDIT CARD!

 

[cove]

Old IT people ....budget cutbacks...ATO error...playing a joke on a taxpayer....computer print error....don't like you always being away travelling...prefer someone else to earn more points than you....
Maybe a bit of all of this list!

 

[Pushka]

Thanks Guys. I'll pay by credit card I do have a PRN although last BAS time (a few days ago) I sent my BAS off without copying it and "lost" my PRN. My ABN number wouldn't work on the portal site so I had to ring the ATO and get a new PRN. I told the person (maybe Cove's ladyfriend?) I was using a credit card and she didnt say anything.

Maybe I should just stop looking at the ATO documentation!

 

[angusburns]

You can pay on-line in lots of $50,000 in one session. I don't know if there is a maximum but, in my experience, you can pay up to at least $350k+ tax for a single entity in a single day on the ATO Optus SmartPay portal. Hope this helps.

 

[sumthinfornuthin]

You pay on line

 

[scheps]

thanks guys, nice to know more than 1 session on 50k online in a day is ok.

 

[cove]

The ATO receipt numbers for paying by credit card were moving up strongly this afternoon. I have set up BPays seeing I am travelling this week. Reloading cards this week should get a big bill settled by 15th which is the due date. I am about half way tonight so I have 8 days to wrap this up with several cards.

 

[angusburns]

Cove is the 'whale' in this frequent-flyer casino...