The ATO’s credit card ban: What it means for your business

The Australian Taxation Office has announced that it will stop accepting credit cards as a payment method after 30 June 2027.

Previously, the ban had been scheduled to come into effect for payments after 30 November 2026. However, following feedback from the small business community, all taxpayers are being given more time to prepare.

What’s happening?

Since 1 October 2026, businesses can no longer add surcharges to payments made via eftpos, Mastercard, Visa, and American Express, following a review by the Reserve Bank of Australia.On the heels of this surcharge ban, the ATO has responded by saying that it will stop accepting credit card payments after 30 June 2027.

According to a statement by the Commissioner of Taxation, Rob Heferen, the costs associated with accepting credit card payments are significant for the ATO, with merchant fees estimated to be almost $200 million annually and expected to continue increasing over time. As a result, the ATO has determined that it is not tenable to absorb the costs associated with accepting credit cards on an ongoing basis.

Alternate payment options

Any taxpayer or business that currently relies on a credit card to cover their tax obligations will need to consider alternative payment options over the coming months. Other payment methods, including debit card, BPAY® and direct deposit, remain available, as do any payments made through Australia Post and international money remitters. Taxpayers with a direct debit arrangement linked to a credit card will also need to update their payment method before their next instalment due after 30 June 2027 to ensure continued compliance with their payment plan.

If alternative payment options really aren’t feasible for a taxpayer, there is still a workaround: the ATO has confirmed that taxpayers wishing to continue using a credit card after 30 June 2027 may continue to use third-party payment providers. However, the ATO encourages such taxpayers to carefully consider relevant fees, charges and processing timeframes.

Support is available

If your business is adversely affected by the ATO’s credit card ban, feel free to reach out to a member of our team. We can work with you to find appropriate alternative payment methods, and can liaise with the ATO on your behalf should you require additional support, such as setting up a payment plan.