The federal government has intervened to delay the Australian Taxation Office’s (ATO) planned ban on card payments, agreeing to cover merchant fees until 30 June 2027.

The ATO initially planned to stop accepting credit card payments in December 2026 to save an estimated $200 million a year in card processing fees. However, following strong backlash from small business owners and industry groups, the government stepped in with a temporary reprieve. Meanwhile, the opposition argues the ban should be scrapped altogether.

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Featured Interview: Tax expert Nitin Saby explains why small businesses rely on card payments, what to do if your payment plan is linked to a card, and how to prepare.

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Why This Matters for Small Businesses

For many operators, paying tax via credit card is a key cash-flow tool:

• Working capital buffer: Up to 55 interest-free days helps bridge the gap while waiting on unpaid client invoices.

• Emergency liquidity: Prevents late-payment penalties when cash is tight.

• Reward points: Helps offset other everyday business expenses.

What Should You Do Now?

• No immediate panic: You can continue paying the ATO by card until 30 June 2027.

• Check your payment plans: If you have an active ATO payment plan linked to a credit card, start planning to switch your linked payment method to direct debit or BPAY before the cut-off.

• Review your cash flow: Speak with your tax advisor early to ensure your business has sufficient liquidity in place once card payments are phased out.