ATO (tax office) payments by credit card

[JohnM]

I've come in late on this thread and my question may have been covered.

Can a C/C fee to pay income tax be claimed as a tax deduction?

 

[Deleted User]

I've come in late on this thread and my question may have been covered.

Can a C/C fee to pay income tax be claimed as a tax deduction?

Personal taxes no, business or self employed yes

Sent from my HTC Desire using AustFreqFly

 

[cove]

This question should be directed to your Accountant/Tax Agent as circumstances of taxpayers can vary greatly.

 

[moa999]

Personal taxes no, business or self employed yes

Sent from my HTC Desire using AustFreqFly

Personal Taxes. No if using Credit.
If however your card is in a Debit balance.

 

[Brisgooner]

thanks for that angusburns I'll be giving it a try next time

 

[doctork]

Just paid my BAS.
The ATO credit card fee for MC is now 0.48%.
That's down from 0.65% last quarter, isn't it?
0.48c per point on a 1/1 earn MC or Visa isn't bad.

 

[Duffa]

0.48% on 1.33 points per dollar card is even better!! (Citibank select to SQ)

 

[cove]

Yes right now it would be CitiSelect Visa for those who have 120,000 income proof (for 1.333 points to Kris per dollar spent)so that is 0.36 cents a point......Good thinking Duffa......
Next is CitiBusiness at 1.25 points but capped at 250,000 per person so you could get your partner a separate card.
Then it would be a choice of Bank West,HSBC,Woolworths and Citibank for point a dollar and watch out for capping and rules of use.
Everything changes so do your own reading/research as this list will go out of date quickly.
Also you earn points on the credit card fee!

 

[cove]

I am curious to know how many of us switched to paying ATO using a point (or better) Visa or MasterCard to pay October taxes? I managed to get about two thirds switched and now I am ready to go totally over. The cost difference....is it too big to ignore or are you thinking 1.5 points on an Amex is still excellent even though the cost of those points is a lot higher? Your thoughts........

 

[Peter2]

Hi Cove & others,

Thanks to this list, I set up Citi Select about 6 months ago and have had great returns from the ATO BAS. The drop in ATO fees is just a sweet bonus.

However, when it comes time to pay our firms BAS it normally blows the Citibank systems. Last time they put a pseudo stop on the card which caused problems. This time I rang Citi security the day before to warn them and they promised it would be okay. They still ended up ringining me on the BAS day to check the ATO fees. I had to inform them to check their own records for the previous days conversation.

Citi select is great once set up. Just don't expect smooth sailing when you have to deal with the back office.

I think I have said this before on this list, I am not sure how this can all last as they don't seem to be making any money from me (quite the opposite). The maths of them continuing to offer such a sweet return just don't add up...

Make hay while the sun shines guys:!:

Peter

 

[cove]

Lucky we don't have to eat hay.
When Citi called this month I told them I had 400,000 to go and they put that into the file notes.
I think they wanted to know the card wasn't stolen to pay someone else's 15 billion that is due or over due.

 

[serfty]

...
Amex is 0.833 cents a point and Visa/MasterCard are 0.48 cents so they are 75% out of my Game (if you get a real point per dollar on Visa/MasterCard and a point and a half on Amex)
You can make 100,480 points for $480 today on Visa/MasterCard versus about 100,833 points for $833 on the best point and a half Amex cards.
Now let me think which one would one use.........??...

The answer depends on how many points you have access to.

As I am able to claim tax deduction on the fees, the ~ costs per point are:

Visa/Mastercard 1 pp$	0.3¢ &
Amex 1½ pp$	0.5¢

Since I do not have the turnover of others, I might put no more than $50,000 through the ATO to generate 50K points per year at a cost of $150 against $325 for 75K.

Now it comes down to what a point may be worth. In my opinion, the more one has up until, say, 300K, the greater their individual worth as part of the collective.

Consider Qantas FF points.

If one has:

1 point: it's not worth a 'brass razoo'!

25,000 points: may be able to redeem them for $300 worth of airfare. (3 x MEL-SYD economy)

50,000 points then $2000 value (MEL-BNE return in Business)

75,000 points then $3200 (MEL-DRW return in business)

150,000 points then $7100 (CBR-LAX return in Business)

200,000 points then $9200 (ADL-LAX return Business)

300,000 points then $17200 (MEL-LAX return in First class)

The trend is there and while there can a few be other examples that buck it there are a lot more that support it.

So, in my circumstance it is likely that those additional 25K points can be worth well more than 10¢ each since they effectivly increase any overall redemption value I may get. This makes the Amex a better proposition for me.

Of course, if one has access to that 300K+ points per year, the Visa/Mastercard would generally be better value.

 

[Peter2]

Lucky we don't have to eat hay.
When Citi called this month I told them I had 400,000 to go and they put that into the file notes.
I think they wanted to know the card wasn't stolen to pay someone else's 15 billion that is due or over due.

Now those figures are impressive.... and I thought I was blowing their systems...

Last time they said they thought I might be money laundering.... I said "Common guys, who is going to money launder with the ATO".

It is time I pushed our accounts department for payment of other ATO taxes so I can catch up ....

P.

 

[cove]

Very well summarized Serfty! I can see your next business purchase needs to be a Post Office.
Don't panic Peter2 there are stacks of companies that don't know.
I am keeping Amex alive as flexibility is a key ingredient to doing business.

 

[jamesD]

I am keeping Amex alive as flexibility is a key ingredient to doing business.

Same here, not cancelling Amex just yet as I expect they will need to up their ante at some stage soon to stay in the game.

 

[Duffa]

Not scrapping my Amex yet. Spent two days in Melbourne on business recently and all but one merchants (small cafe) took Amex with no surcharge. Hotel of course stacked on 1.5% but that was the same for Amex or Visa.
Believe or not, will still put BAS thru on Amex. The higher the points the higher the redemption return.

 

[cove]

Yes you are looking at it based on the redemption value so no one will lose this way unless the points expire. Good thinking 99.
Time to put a cone of silence into place so KAOS/CHAOS does not prevail.

Yes I plan to keep all 3 family American Express cards running but at much reduced levels.

 

[albatross710]

I am curious to know how many of us switched to paying ATO using a point (or better) Visa or MasterCard to pay October taxes? I managed to get about two thirds switched and now I am ready to go totally over. The cost difference....is it too big to ignore or are you thinking 1.5 points on an Amex is still excellent even though the cost of those points is a lot higher? Your thoughts........

For me it is a question of volume. When I am building the KF balance, I will pay the extra ATO Amex surcharge as it still makes for good value premium cabin travel. For me the ATO surcharge is tax deductible to my trading entity. In summary, paying on the AMex creates a higher cost/mile but I get more of them.

I believe the economists call this the Law of Diminishing Returns.

 

[cove]

In the land of frequent flying it would be the Law Of Having Enough.
Looking at your Frequent Flyer point balance and seeing you are a few points short would be like being at the supermarket checkout with empty pockets.....very frustrating indeed.

 

[kpc]

My accountant rang me today to tell me about my tax bill. Instead of being annoyed, I was calculating how many FF points I can get! Is that bad?:shock::shock:. I think I might apply for the CitiBusiness Gold Visa as I don't have to pay the bill till March next year and I might as well get 1.25 pts per dollar spent + the 40000 pts sign up bonus.