If paying your tax bill by credit card is part of how your business manages cash flow, there is important news about how you will be able to settle your future ATO obligations.
What’s changing?
The ATO previously announced that it would stop accepting direct credit card payments after 30 November 2026. That transition period has now been extended to 30 June 2027.
The ATO said its original decision followed changes to card surcharging rules arising from the Reserve Bank of Australia’s Review of Merchant Card Payment Costs and Surcharging. The ATO said it did not consider it appropriate for the cost of credit card merchant fees to be transferred to the community.
Following the announcement, small businesses and other taxpayers raised concerns about the short time available to transition away from direct credit card payments.
In response, the Federal Government announced transitional funding to allow the ATO to continue accepting credit card transactions until the end of the 2026–27 financial year. The Government also said the additional time would allow the ATO to:
- consult with small businesses and other taxpayers who rely on credit cards;
- provide more information about the changes;
- identify alternative arrangements for businesses and individuals who are unable to pay by other methods; and
- consider support options for taxpayers experiencing financial hardship.
ATO payment options
While the extended deadline provides some welcome breathing space, it is worth reviewing your payment arrangements sooner rather than later.
The ATO offers a range of alternatives to direct credit card payments, including:
- BPAY through your financial institution;
- debit card payments through ATO online services or Government EasyPay;
- direct debit from an Australian cheque or savings account or debit card;
- electronic funds transfer to the ATO direct credit account;
- payment in person at Australia Post using cash, EFTPOS or cheque; and
- payment by cheque sent to the ATO.
Cheques remain a current payment option, but Australia’s cheque system is also being phased out.
Under the Government’s transition plan, cheque issuance will cease by 30 June 2028, while cheque acceptance will cease by 30 September 2029.
These are national milestones and are not ATO-specific cut-off dates.
What should you do now?
If your business currently pays the ATO directly by credit card, now is a good time to:
- review how you currently pay your tax obligations and how those payments fit with your cash flow and other short-term financial commitments;
- check whether any direct debit arrangements or payment plans are linked to a credit card, particularly where an instalment is due after 30 June 2027;
- consider how you will fund your tax payments once direct ATO credit card payments end; and
- check that the bank account details for any new direct debit arrangements are correct.
After 30 June 2027, the ATO says taxpayers who still want to use a credit card may be able to do so through third-party payment providers.
Before using a third-party provider, check its fees, charges and processing timeframes to make sure the arrangement suits your business.
The ATO has also encouraged taxpayers to remain vigilant against scams and check the credentials of any third-party provider before sharing business information or making a payment.
24 October 2026