ATO credit-card cutoff moves to 30 June 2027 after small-business pushback

The Australian Taxation Office’s credit-card cutoff has been pushed back seven months. In a joint media release on 9 October, Treasurer Jim Chalmers, Small Business Minister Anne Aly and Assistant Treasurer Daniel Mulino say the ATO will keep accepting credit cards until 30 June 2027.

That replaces the date the ATO announced on 1 October, when it said it would stop accepting credit-card payments after 30 November 2026. If your business was preparing to move tax payments off a credit card before December, the deadline for that job has moved to the end of the financial year. For payment plans, that appears to apply too, but the ATO hasn’t yet updated its payment-plan guidance.

What the government announced

The ministers say small businesses told them the ATO’s timeframe was inadequate. The government will provide transitional funding so the ATO can keep accepting credit-card transactions until the end of the financial year, with the cost to be finalised in MYEFO, the mid-year budget update.

The release says the extra time is for the ATO to engage with small businesses and other taxpayers who rely on credit cards, give more detailed information to those affected, and consult on targeted options to support them. The government has also asked the ATO to consult on:

• how best to support people experiencing financial hardship, and
• alternative arrangements for businesses and individuals who can’t pay by other methods.

The release doesn’t say when or how that consultation will run.

Why the ATO wanted to stop

The ATO’s original decision followed the Reserve Bank’s surcharging reforms, which ended card surcharges from 1 October. The ministers say the ATO tried to get lower fees from the credit-card companies, but they “did not offer sufficiently low fees” for the ATO to keep accepting cards. The ATO will keep talking to the card companies.

The release puts the scale in numbers: just over 2% of individuals and around 5% of small businesses paid the ATO by credit card in 2024–25.

What happens after 30 June 2027

The phase-out is delayed, not cancelled. After 30 June 2027, the release says the ATO “will continue to accept credit card payments via third parties”, along with free and low-fee methods such as debit card and bank transfer.

It doesn’t name those third parties or say what they will charge. Until the ATO publishes details, don’t assume paying by credit card through a third party will cost the same as paying by card now.

What this means for payment plans

The ATO’s 1 October guidance said anyone with a payment plan linked to a credit card would need a different payment method before the first instalment due after 30 November 2026, and that it was writing to affected payment-plan users.

On our reading of the release, a credit card can stay on a payment plan beyond 30 November, because the ATO will keep accepting card transactions until 30 June 2027. The ATO’s own pages still need to be updated to confirm that. We couldn’t access them on 9 October, so check them, or any new letter from the ATO, before you change or cancel a plan.

That matters because the ATO’s payment-plan guidance warns that switching between card payments and a bank-account direct debit means cancelling the existing plan and setting up a new one. It also warns that cancelling a plan while overdue debt remains can prompt collection action. If you had planned that change only because of the November date, there appears to be no need to rush it, but confirm with the ATO first.

If you do want to move off a credit card anyway, the setup lead times in the ATO’s guidance haven’t changed: at least one business day before an instalment for a debit-card direct debit, or three business days for a bank-account direct debit. Our original story covers those steps and BPAY payment references.

The extra time is also a chance to work out how the business will fund tax payments without paying the ATO directly by credit card, including any interest-free period the business relies on, before 30 June 2027 rather than in the last week. Our card-surcharge explainer covers the separate rules on what you can now charge your own customers.

Checklist

• Move the ATO credit-card deadline in your calendar. Replace 30 November 2026 with 30 June 2027 for switching one-off tax payments off a credit card, and mark payment plans as awaiting the ATO’s confirmation.
• Check the ATO’s website or any new ATO letter before changing a payment plan. Don’t cancel or replace a credit-card-linked plan just to beat 30 November; if you still have overdue debt, ask the ATO or your registered tax professional first, because cancelling a plan can prompt collection action.
• Plan how you’ll pay the ATO from 1 July 2027. Have the owner and bookkeeper choose between debit card, bank transfer or a third-party card payment, checking the providers and fees once the ATO publishes details.
• Watch for the ATO’s consultation on hardship and alternatives. If the business is in financial hardship or can’t pay by other methods, look for the ATO’s information on the support options it consults on.