TITLE: ATO Credit Card Ban, Client-to-Agent Linking Expansion and the 28 October BAS Deadline
ATO credit card ban creates political uncertainty
The ATO plans to stop accepting direct credit card payments from 1 December 2026. The final day for a direct credit card payment is 30 November 2026.
The decision has triggered public disagreement between Labor frontbenchers.
Housing Minister Clare O’Neil said the government had “some real concerns about what the ATO is proposing to do here” and wanted the ATO to return to discussions with business. Small Business Minister Anne Aly also urged the ATO to continue talking with small businesses.
However, Assistant Minister Andrew Charlton said that “the government supports the ATO’s decision”. He argued that the 98% of taxpayers who do not pay by credit card should not subsidise those who do.
Treasurer Jim Chalmers said the ATO is an independent authority and made the decision itself. He also said the government insisted on a transition period.
The conflicting messages have increased uncertainty for Australian businesses. You can read the latest political response in the ABC News report and the Sydney Morning Herald coverage.
Small businesses are calling for the ban to be reconsidered
The Australian Chamber of Commerce and Industry has called for one clear outcome across government. Chief executive Andrew McKellar said the 5% of small businesses affected represents approximately a quarter of a million businesses.
Independent MPs Kate Chaney and Allegra Spender, along with Independent Senator David Pocock, have also called for the decision to be reconsidered or reversed.
The Housing Industry Association has urged the government and the ATO to reverse the ban. It warned that removing credit card payments could worsen cash-flow pressures for home builders.
The ATO says credit card payments represented 2.3% of all payments collected in 2024–25. More than 60% of credit card payments by value came from privately owned and wealthy groups, public entities and multinationals. Around 5% of small businesses and just over 2% of individual taxpayers used credit cards to pay tax during that period.
These figures explain the ATO’s position. However, usage statistics do not show why a business used a credit card. Some businesses may have used cards for convenience, while others may have been bridging a short-term gap between paying suppliers and receiving customer receipts.
The ATO’s official announcement confirms the planned change.
Cash-flow pressure makes the timing important
The decision comes as some Australian businesses are already experiencing increased financial pressure.
An Australian National Audit Office report found that small businesses owed $35.9 billion in collectable tax debt in 2024–25. This was $19.4 billion higher than in 2018–19.
Financial Counselling Australia reported a 21% increase in cases handled by its small business debt helpline during 2025. Almost two-thirds involved ATO debt.
The Reserve Bank of Australia’s October 2026 Financial Stability Review also identified growing cash-flow pressures, particularly for smaller businesses and businesses operating in construction, hospitality and retail.
This matters for ecommerce brands, digital businesses, agencies and other growing companies because tax liabilities often become payable before customers settle invoices. A quarterly BAS, PAYG withholding amount or income tax instalment can therefore create a timing problem even when the business remains commercially viable.
Build your alternative ATO payment plan now
Do not wait until November to discover that your payment process depends on a credit card.
Use this checklist to prepare:
- List every upcoming ATO liability. Include BAS, GST, PAYG withholding, PAYG instalments, superannuation-related obligations and income tax.
- Match each liability to a permitted payment method. Debit cards, BPAY, bank transfers and direct debit remain available.
- Review your bank payment limits. This will help you avoid a failed transfer when a large liability becomes due.
- Check existing payment plans. Confirm the repayment amount, due dates and available account balance.
- Contact the ATO early if cash flow is tight. Early contact gives you more time to discuss an ATO payment arrangement.
- Update your internal approval process. Make sure someone is responsible for releasing payments before each due date.
- Record all payment confirmations. This protects your business if a payment is delayed or incorrectly allocated.
The ATO’s payment guidance explains the available payment methods.
ATO payment plans can provide breathing space, but general interest charges continue to accrue. Also remember that ATO interest incurred from 1 July 2025 is no longer tax deductible.
Other funding options may include a bank overdraft, business loan or another short-term facility. Some third-party payment platforms may also accept a credit card and pay the ATO on your behalf for a fee. Check the provider’s terms, total cost and payment timing carefully before relying on this option.
Client-to-agent linking will expand to sole traders
The ATO is expanding its client-to-agent linking process to individuals and sole traders.
The current process generally applies to entities with an ABN, excluding sole traders. This includes companies, trusts, partnerships and self-managed superannuation funds.
Under the expanded process, the registered tax or BAS agent will initiate the linking request. The client will then authorise that request through ATO online services or the ATO app.
The agent will not be able to access the relevant information or act on the client’s behalf until the authorisation is completed.
A pilot is expected to begin in March 2027, ahead of full implementation in November 2027. The change is designed to strengthen security and provide greater transparency over who is authorised to access taxpayer information.
The process may apply when you:
- appoint a new registered tax or BAS agent;
- change from one agent to another; or
- give an existing agent authority over an additional obligation.
There is nothing most sole traders need to do immediately. Wait for your registered agent to contact you with instructions. The SB Group’s explanation of the expansion provides further detail.
