Businesses will still be able to pay Australian Taxation Office obligations by credit card through third-party payment platforms, according to B2Bpay. The company said the ATO had confirmed those platforms are not covered by its proposed ban on direct credit card payments.
The clarification comes amid uncertainty over the tax office's proposal to stop accepting direct credit card payments after the middle of next year. B2Bpay said the key distinction is between the ATO accepting cards directly and businesses using a separate provider to process card payments for tax obligations.
Tax Commissioner Rob Heferen recently acknowledged shortcomings in the consultation process around the proposal and said he had "jumped to conclusions" about why businesses used cards to pay tax. The comment has become a focal point in a wider debate over whether card-based tax payments reflect financial stress or routine cash-flow management.
Jane Grant, chief of B2Bpay, said the Commissioner's remarks reflected how many businesses approach tax payments.
"For many businesses, using a credit card to pay tax is simply smart cash-flow management," Grant said.
"It can give a business additional time between making a payment and money leaving its bank account, which can be particularly valuable when it is waiting for customers to pay invoices.
"The Commissioner's comments recognise that businesses use credit cards for many different reasons and that access to an interest-free period can be an entirely legitimate way of managing working capital," she said.
Policy distinction
Grant said there had been confusion about the practical effect of the ATO's proposed changes after 30 June 2027. She pointed to the difference between the tax office refusing direct card payments and a business still being able to use a card through an intermediary.
"The most important thing for businesses to understand is that the proposed ATO ban does not mean they will no longer be able to use a credit card to pay their tax," Grant said.
"Even if the ATO stops accepting direct credit card payments from 1 July 2027, businesses will still be able to use third-party payment platforms such as B2Bpay to make ATO payments using eligible cards.
"There is an important distinction between the ATO no longer accepting credit cards directly and businesses no longer being able to use credit cards to pay tax. They are not the same thing.
"B2Bpay provides certainty for businesses that want to retain the flexibility of paying their tax obligations by card, regardless of whether the ATO proceeds with its proposed changes," she said.
The issue matters for companies that use credit cards to manage the timing of large payments, especially when tax liabilities fall due before customer invoices are settled. In that context, putting a tax payment on a card can extend the period before cash leaves a business bank account.
B2Bpay said businesses using its platform can pay ATO obligations with eligible credit cards while potentially earning card rewards and B2B Points. It presented that as an added benefit for firms already making sizeable tax payments.
"Tax is one of the biggest expenses many businesses face, so if they are going to make that payment anyway, there is an opportunity to make that transaction work harder for the business," Grant said.
"Depending on the card and transaction, businesses may be able to earn rewards points while also gaining the cash-flow benefits that come with paying by card.
"The debate over the ATO's policy will continue, but businesses don't need to wait until 2027 to work out what it means for them. Third-party payment platforms will remain an option, giving businesses certainty that they can continue paying the ATO by card," she said.