# Tax office will keep taking credit cards until 30 June 2027 Canberra will fund the ATO to accept credit cards for seven more months. What moved, what the cost is, and which property tax bills are affected. --- The Australian Taxation Office will go on accepting credit cards until 30 June 2027, seven months longer than it had planned. Treasurer Jim Chalmers announced the extension on Friday 9 October 2026 in a joint media release with Small Business Minister Anne Aly and Assistant Treasurer Daniel Mulino, and said the Commonwealth would pay for it. The decision follows the tax office's notice, reported in this magazine earlier the same day, that it would stop taking credit cards after 30 November 2026. That date is now replaced. The end point itself is not: the release describes a longer transition before the ATO phases credit cards out, and does not say the phase-out is cancelled. For property owners the change is narrower than it sounds. It touches the tax bills that go to Canberra, such as tax on a capital gain, tax on rent and the amounts a buyer withholds at settlement. Land tax and transfer duty go to the State, where the rules on cards moved in the opposite direction on 1 October.
30 June 2027new last day for credit cards at the ATO
$200ma year in merchant fees, the ATO's estimate
2.3%of ATO collections paid by credit card

Treasury ministers' joint media release, 9 October 2026; ATO Commissioner's statement on credit cards, 2 October 2026. The fee estimate is "almost $200 million". The statement gives no year for the share of collections.

## What the Treasurer announced The ministers' release is short and specific on the date. The Government will provide what it calls transitional funding so that the ATO can keep accepting credit card transactions until the end of the financial year, 30 June 2027. The reason given is the reaction of small business. "Australian small businesses have said the ATO's announced timeframe was inadequate," the release states. The extra time comes with a list of things the tax office is expected to do. According to the release, the ATO will engage further with small businesses and other taxpayers who rely on credit cards, give more detailed information to the people affected, and consult on targeted support options. The Government has also asked it to consult on support for people in financial hardship, and to identify arrangements for those who cannot pay by other means. The release adds that the ATO will keep talking to the card companies about their fees. The tax office's own notice, as it stood on 9 October, had not caught up. It still carried the heading that the ATO would stop accepting credit cards after 30 November 2026, and still told taxpayers whose payment plan or direct debit is linked to a credit card to change their payment method before the first instalment due after that date. Those taxpayers were being written to directly, the notice says. How that instruction will be reissued for the new date had not been published. ## A cost that has no figure yet The release gives no dollar amount for the funding. It says only that the cost will be finalised in MYEFO, the Mid-Year Economic and Fiscal Outlook, which the ABC reports is due in December. The only number on the public record is the one the tax office gave a week earlier. In a statement published on 2 October 2026, the ATO said merchant fees on credit card payments were estimated at almost $200 million a year and were expected to keep rising. AAP, in a report carried by InDaily Queensland on 9 October, attributed the figure to ATO Commissioner Rob Heferen. That is a full-year estimate. The extension runs from 30 November 2026 to 30 June 2027, which is seven months, and no estimate for that period has been published. The Commissioner's statement had also anticipated the solution the Government has now chosen, and was cool on it. Absorbing the fees indefinitely, the statement said, would mean less revenue and less funding for government services, and meeting the cost through additional public funding for the ATO would have the same ultimate outcome. ## Why the tax office wanted out The background is a decision of the Reserve Bank. On 31 March 2026 the RBA's Payments System Board published the conclusions of its Review of Merchant Card Payment Costs and Surcharging. It decided to remove surcharging on debit, prepaid and credit cards on the eftpos, Mastercard and Visa networks, and to lower the caps on the interchange fees that sit behind what a business pays to accept a card. Most of the package, including the end of surcharging and the lower caps on domestic transactions, took effect on 1 October 2026. The cap on foreign cards and some of the new fee transparency rules follow on 1 April 2027. The Treasury ministers' release of 1 October put the size of the change at about $1.6 billion in card surcharges that consumers will no longer pay, without stating a period. With surcharging gone, the fee on a card payment stays with whoever accepts the card. A shop can allow for it in its prices. The ATO says it has no equivalent. "Because tax liabilities are legislated, the ATO cannot build card payment costs into prices," the Commissioner's statement says. The statement adds two further points. The tax office approached the credit card companies for a lower rate and was not offered one low enough to keep cards. And it would have preferred to keep accepting them.
How the dates fell
  1. 31 March 2026The Reserve Bank publishes its decision to remove card surcharging.
  2. 1 October 2026Surcharging ends on eftpos, Mastercard and Visa. The ATO's notice names 30 November as its last day for credit cards.
  3. 2 October 2026The Commissioner's statement puts merchant fees at almost $200 million a year.
  4. 9 October 2026The Treasurer announces funding to keep credit cards until 30 June 2027.
  5. December 2026The cost of the extension is due to be finalised in MYEFO.
## Who pays tax by card The tax office's own figures describe a small group. Credit cards make up 2.3 per cent of total ATO collections, according to the Commissioner's statement, which gives no year for that share. Just over 2 per cent of individual taxpayers and about 5 per cent of small businesses paid by credit card in 2024-25, a pair of figures the ministers' release repeats. More than 60 per cent of the value of credit card payments came from what the ATO calls privately owned and wealthy groups and from public and multinational businesses. Those figures were used on both sides of the week's argument. The tax office read them as showing that most taxpayers already pay another way. Business groups and crossbench MPs read them from the position of the minority that does use a card, and of the notice it was given. The independent MP Kate Chaney, quoted by the ABC, put the case in terms of timing. "Credit cards are one way businesses manage cash flow when a tax bill lands," she said, adding that removing the option with about eight weeks' notice made things harder. The Australian Chamber of Commerce and Industry, whose chief executive had asked earlier in the week for a clear message from government in support of small business, according to the ABC, welcomed the extension. "This announcement provides some much-needed breathing space for small business," Andrew McKellar said, as quoted by the ABC. The Opposition's position, as reported by the ABC and AAP, is that the ATO's plan should be dropped altogether, not postponed. ## Which property tax bills are affected The extension concerns payments made to the ATO only. The table sets out where the main property-related taxes are paid.
Property taxes and who collects themQueensland, October 2026
TaxPaid toHow it arises
Capital gains taxATOPart of income tax, reported in the seller's tax return.
Tax on rental incomeATORent is declared in the owner's tax return.
GST at settlementATOBuyer of a new home or residential land withholds part of the price.
Foreign resident capital gains withholdingATOBuyer withholds 15% where the seller has no clearance certificate.
Land taxQueensland Revenue OfficeAnnual state tax on freehold land owned at midnight on 30 June.
Transfer dutyQueensland Revenue OfficeQueensland Government tax on buying or transferring property.

ATO pages on capital gains tax, rental income, GST at settlement and foreign resident capital gains withholding; Queensland Revenue Office pages on land tax and transfer duty.

On the first two rows, the ATO states that capital gains tax is not a separate tax but part of income tax, so a gain on a property sale ends up in the same assessment as salary and rent, and the ATO requires rent to be declared in the owner's return. The two settlement withholdings work differently. Under the GST at settlement rules, which apply to contracts entered into from 1 July 2018, the buyer of new residential premises or potential residential land withholds one eleventh of the contract price, or 7 per cent where the margin scheme applies, and pays it to the ATO at settlement using a payment reference number. Under foreign resident capital gains withholding, the ATO says the buyer must withhold 15 per cent, for contracts signed from 1 January 2025, unless the seller is an Australian resident holding a clearance certificate, and pay it at or before settlement. The sources do not say whether credit cards are used for these amounts at all. ## The State went the other way The last two rows of the table are outside the announcement. Land tax and transfer duty are collected by the Queensland Revenue Office, and the Commonwealth's decision has no bearing on them. While the federal tax office was preparing to stop taking credit cards, the State stopped charging for them. The Queensland Revenue Office announced on 16 September 2026 that from 1 October 2026 a surcharge would no longer apply to card payments. Its notice lists the payments covered: state taxes, duties and royalty, fines, and debts to the State Penalties Enforcement Registry. It also explains that what counts is the day of payment, not the date printed on the bill. A payment made on 1 October 2026 or later carries no card surcharge, and some notices may go on showing the old surcharge warning for a time before they are updated.
Still in place

The phase-out is delayed, not dropped

The ministers' release of 9 October moves the date to 30 June 2027 and funds the months in between. It does not reverse the ATO's decision, and the Reserve Bank's ban on card surcharges is untouched.

## What is still to be settled Three things are open after the announcement. The first is the cost, which the Government has tied to MYEFO in December. The second is the outcome of the consultation the ATO has been asked to run: the release names targeted support, hardship and arrangements for people who cannot pay another way as subjects, and gives no date for a result. The third is the card companies. The release says the ATO will keep engaging with them, after an approach that the Commissioner's statement says did not produce a rate low enough. What the release does say about the period after 30 June 2027 is that the ATO will keep accepting free or low-fee methods such as debit card and bank transfer. The same passage of the release states that after that date the ATO will continue to accept credit card payments via third parties, and gives no detail of what that covers or what it would cost the payer. The tax office's statement of 2 October also restated its standing position on difficulty: taxpayers who are struggling to pay are asked to speak to the ATO or a registered tax professional early, and payment plans and hardship assistance remain available. Whether an owner is affected depends on how they pay now and on what they owe.