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Tax season is stressful, especially when you’re staring at your HMRC bill.
Maybe you wish you could take it upon yourself credit card for rewardsjust like before. Frustratingly, HMRC no longer directly accepts personal credit cards. Fortunately, some solutions still offer benefits.
HMRC’s decision to stop accepting personal credit cards had a direct impact on both individual and business taxpayers. Many relied on credit cards for convenience and rewards points. What options remain for those who want similar benefits while meeting their tax obligations? Let’s look at how you can optimize your HMRC payments.
Using a Tesco debit card
Consider a Tesco Bank payment card. Many debit cards offer few rewards. However, this one earns Clubcard points: one point for every £8 spent. These points are worth 2.4 Avios, 2.5 Virgin Flying Club miles or 3p in Hotels.com credit.
If you pay £1,000 in taxes you will earn 125 Clubcard points (300 Avios). Please be aware of possible restrictions when opening accounts with Tesco Bank at this time.
Deploy Billhop
Billhop is useful for large tax bills, especially if you like American Express rewards or are looking for a spending bonus. Billhop charges your credit card as a purchase, not a cash advance, so you still earn rewards. There is a surcharge of 2.95%.
The table below breaks down Billhop’s fees, illustrating the cost implications associated with different income tax amounts.
| HMRC tax amount (£) | Fees @ 1% (£) | Fees @ 2% (£) | Fee @ 2.5% (£) | Billhop fees @ 2.95% (£) |
| 1,000 | 10am | 8 p.m | 25:00 | 29.50 |
| 5,000 | 50:00 | 100.00 | 125:00 | 147.50 |
| 10,000 | 100.00 | 200.00 | 250.00 | 295.00 |
| 15,000 | 150.00 | 300.00 | 375.00 | 442.50 |
Use curve
You could use Curvea debit Mastercard linked to your credit cards. It converts debit transactions into credit transactions, earning you points. While it used to be an easy way to get rewards for HMRC payments, there is now a 1.5% fee even with the free version.
This fee is waived with the Curve Metal paid version (approximately £15/month). Weigh the costs and benefits to see if this approach fits your national insurance and tax planning strategies.
The Miles & More Global Traveler Mastercard
This Mastercard is treated as a prepaid card, not a credit card. This allows HMRC to process payments from it, at a rate of 1.25 miles per £1 spent. You will also need to submit accurate VAT registration forms.
However, be aware of HMRC’s supervision of business and VAT payments made through this card. Individual international tax or income tax returns may perform better with this method, provided it complies with local holidays.
Exploring Fintech Solutions (use with caution)
Some fintech solutions link credit cards to accounts that are processed as purchases. These options are unreliable because policies change often. New apps may appear that offer similar services. Businesses, both small and large, and sole traders, find value in credit card payments for HMRC (indirectly). Rewards, convenience, and sometimes extensive lines of credit to cover tax debts are some of the attractive features.
It is no longer possible to pay directly to HMRC by credit card. However, solutions exist for those looking for rewards and flexible payment options. Research thoroughly before choosing a method. Additional information can be found atpay your VAT, paying your own tax assessmentsAnd pay corporate tax online.