Nobody likes paying tax, but using the right credit card to pay your dues – including income tax obligations and HECS debt repayments – could deliver you a bounty of Qantas or Virgin Australia frequent flyer points.
Savvy business owners can use their business or corporate credit card to settle the company’s BAS and PAYG obligations for an even greater points haul.
But there’s one important caveat: not all Aussie credit cards earn frequent flyer points on tax payments. In fact, some credits cards provide points at significantly reduced rates compared to ordinary transactions.
Given that you’ll pay a 0.54% surcharge on all Visa and MasterCard tax payments and a 1.45% fee on all American Express ATO charges, Australian Business Traveller highlights five of the best cards for making the most of your next tax bill, including how many points you can earn and what you’ll pay in annual fees.
1. Commonwealth Bank Business Platinum Awards American Express
ABN holders can pocket up to 1.5 Virgin Australia Velocity frequent flyer points per dollar spent with the ATO via the Commonwealth Bank Business Platinum Awards American Express, or a still-reasonable 1.2 Qantas Points per dollar spent when opting for Qantas Points instead.
There’s an annual fee of $300 to pay – plus an extra $30 per year if choosing Qantas Points – but in return you’ll also get a CBA Business Platinum Awards MasterCard at no extra charge, earning either 0.4 Qantas Points or 0.5 Velocity points per dollar on all spend, including with the ATO.
A total points cap of 300,000 Commonwealth Awards points applies per calendar year across the total spend of both cards, equal to 150,000 Velocity points when converted on a 2:1 basis, or 120,000 Qantas Points when converted automatically every month.
2. Qantas American Express Discovery, American Express Velocity Escape
Looking to pay your income tax or make a HECS debt repayment? Both the Qantas American Express Discovery Card and American Express Velocity Escape Card serve up one frequent flyer point per dollar spent with either Qantas or Velocity, as applicable.
That includes payments to the Tax Office, along with other government charges, insurance and utility costs and on all remaining spend, with no annual fees to pay and no monthly or annual points capping to contend with, either.
3. St. George Amplify Signature Visa
Whip out a St. George Amplify Signature Visa and you could earn up to 0.825 frequent flyer points per dollar paid to the tax man with airlines such as Qantas, Virgin Australia, Singapore Airlines and Malaysia Airlines – and with no points capping, provided the card is used for personal charges only.
It works like this: choose ‘Amplify Qantas’ rewards and you’ll initially earn 0.75 Qantas Points per dollar spent, and when your birthday rolls around, you’ll earn a ‘birthday bonus’ of 10% of the points you’ve earned in the past year, taking your total haul to 0.825 Qantas Points per dollar.
Similarly, choose ‘Amplify Rewards’ to earn 1.5 Amplify points per dollar (equal to 0.75 frequent flyer points with those other airlines) and you’ll also earn a 10% bonus when cutting your birthday cake, with an annual fee of $279 covering both rewards options.
4. Westpac Altitude Black American Express
While many Australian banks no longer award points on credit card tax payments, Westpac continues to offer these, just at a lower rate per dollar than for regular spend.
Accordingly, Altitude Black AMEX cardholders pick up either 0.75 Qantas Points per dollar or the equivalent of 0.75 Velocity Points, 0.75 Malaysia Airlines Enrich miles, 0.6 Singapore Airlines KrisFlyer miles or 0.6 Cathay Pacific Asia Miles via the bank’s Altitude Rewards program.
Cardholders pay an annual fee of $395 which also includes a companion Altitude Black MasterCard, yet the MasterCard earns no points on tax payments, so stick to paying by AMEX if this is your bank of choice.
5. Bankwest Qantas World MasterCard
Pay your tax bills with a Bankwest Qantas World MasterCard and you could scoop up 0.66 Qantas Points per dollar spent, uncapped.
This formerly-‘secret’ card has long been a favourite of existing Bankwest customers, but can now be applied for by members of the general public: including those who don’t already bank with Bankwest.
There’s a $270 annual fee, but in the same token, the ATO’s surcharge on MasterCard payments (0.54%) is significantly lower than billed on American Express transactions (1.45%) – so you’ll pay less in fees on every dollar of tax you contribute.
Receive 50,000 bonus Membership Rewards points when you apply online, are approved and spend $3,000 on your new Card in the first 3 months from the Card approval date.
- Receive 50,000 Membership Rewards Bonus Points when you apply online, are approved and spend $3,000 on your new Card within the first 3 months. This offer is available to new Card Members, as well as Bank-issued American Express companion cardholders
- Start exploring with a $400 Travel Credit every year
- Enjoy two complimentary entries per year to the American Express Lounge, located at Sydney International Airport or Melbourne International Airport
- 0% p.a. on balance transfers for the first 12 months — A one-off credit plan establishment fee of 1% applies
- No cap on earn rate. You can earn up to 2 Membership Rewards points per $1 spent, no matter how much you spend each month
- Transfer your points to a choice of 8 Airline Partner Programs including Virgin Australia and Singapore Airlines
- Spend more and earn more points by getting up to 4 Supplementary Cards for family members at no additional fee
- Travel with peace of mind knowing that you'll also enjoy extensive protection for you and your partner and dependent children when you pay for travel on your American Express Explorer® Credit Card