Tax season is stressful, especially when you’re staring at an HMRC bill.
Maybe you wish you could have it on your device Credit card to get rewardsjust like the old days. It is frustrating that HMRC no longer accept personal credit cards directly. Fortunately, some solutions still offer perks.
Navigating HMRC payments in 2024
HMRC’s decision to stop taking personal credit cards has directly impacted both individual and corporate taxpayers. Many relied on credit cards for convenience and reward points. What options remain for those who want similar perks while meeting their tax obligations? Let’s explore how you can improve your HMRC payments.
Using your Tesco Bank debit card
Consider the Tesco Bank Current Account Debit Card. Many debit cards offer few rewards. However, this card earns Clubcard points — 1 point for every £8 spent. These points are worth 2.4 Avios, 2.5 Virgin Flying Club miles, or 3p Hotels.com credit.
Paying £1,000 in taxes nets you 125 Clubcard points (300 Avios). Be aware of the potential restrictions of opening an account with Tesco Bank currently.
Take advantage of BelHub
The Billhop app is useful for larger tax bills, especially if you love American Express rewards or are aiming for a spending bonus. Billhop charges your credit card as a purchase, not as a cash advance, so you still earn rewards. There is a 2.95% fee.
The table below explains Billhop’s fees, and shows the cost implications associated with varying income tax amounts.
| HMRC tax amount (£) | Fees @ 1% (GBP) | Fees @ 2% (GBP) | Fees @ 2.5% (GBP) | Billhop fees @ 2.95% (GBP) |
| 1000 | 10.00 | 20.00 | 25.00 | 29.50 |
| 5000 | 50.00 | 100.00 | 125.00 | 147.50 |
| 10,000 | 100.00 | 200.00 | 250.00 | 295.00 |
| 15000 | 150.00 | 300.00 | 375.00 | 442.50 |
Use the curve
You can use curvewhich is a Mastercard debit card linked to your credit cards. It converts debit transactions into credit transactions, thus earning you points. While it was previously a simple way to get rewards on HMRC payments, even with the free version, there is now a 1.5% fee.
This fee is waived with the paid version of Curve Metal (about £15 per month). Weigh the costs and benefits to see if this approach is consistent with your national insurance and tax planning strategies.
Miles & More Global Traveler MasterCard
This Mastercard is treated as a prepaid card, not a credit card. This allows HMRC to process payments from them, at a rate of 1.25 miles for every £1 spent. You will also need to submit accurate VAT registration forms.
However, be aware of HMRC’s scrutiny of business and VAT payments via this card. International tax returns or individual income tax returns may be better off using this method, provided it falls within local bank holidays.
Explore 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 frequently. New apps may emerge offering similar services. Businesses, both small and large, and sole traders, find value in HMRC credit card payments (indirectly). Bonuses, convenience and sometimes extended lines of credit to cover tax debt are among the attractive features.
Paying directly to HMRC using a credit card is no longer possible. However, there are solutions for those looking for rewards and flexible payment options. Research carefully before choosing a method. You can find additional information aboutPay your VAT, Pay self-assessment tax billsand Pay corporate tax online.