Paying Tax by Debit Card or Business Credit Card: What HMRC Allows

This guidance is for individual taxpayers who want to know whether they can pay their tax by debit card or credit card, and what to consider before choosing this payment method.

Paying tax by card can be convenient, but it can also involve fees, interest, and assumptions that may cause problems if misunderstood. This page explains when card payments are possible, what HMRC allows, and where caution is needed.

Paying HMRC by Debit or Credit Card

It is possible to pay HMRC by corporate credit card or corporate debit cards. The use of these cards is subject to a fee. Payment by personal debit cards is currently fee-free. There is also no charge for payment by Direct Debit, bank transfer or cheque, all of which are commonly handled through a tax payment service in London.

HMRC has not accepted personal credit cards since January 2018 when credit card surcharges on personal credit cards were banned.

You can pay HMRC online using a suitable credit / debit card for:

• Self-Assessment
• Employers’ PAYE and National Insurance
• VAT
• Corporation Tax 
• Stamp Duty Land Tax Income Tax (because you previously under-paid)
• Imported goods you have declared on the Customs Declaration Service
• Miscellaneous payments (if your payment reference begins with ‘X’)

When making a payment for Self-Assessment, you should use your 11-character payment reference. This is your 10-digit Unique Taxpayer Reference (UTR) followed by the letter ‘K’.

HMRC will accept your online debit or credit card payment on the date you make it. This includes payments made on bank holidays and weekends.

Risks and Costs of Paying Tax by Card

While HMRC allows some tax payments to be made by card, this option can involve additional costs. Credit card payments usually attract a processing fee, and interest may apply depending on your card provider.

It is also important not to confuse paying by credit card with a Time to Pay arrangement. Paying by card does not reduce your tax liability or change HMRC deadlines — it simply changes how the payment is funded.

Check Whether Paying Tax by Card Is the Right Option

Paying tax by debit or credit card may be convenient in some cases, but it can also increase costs or create longer-term issues. A short review now can help you decide whether card payment is appropriate for your situation.

In Practice – Common Misunderstandings About Card Payments

In practice, we often see taxpayers assume that paying by credit card gives them extra time to settle their tax bill. In reality, this can simply replace an HMRC debt with a higher-cost personal debt, particularly where card interest is applied.

If you’re looking for practical guidance, experienced accountants in Fulham Broadway work with individuals in surrounding areas such as Parsons Green and Imperial Wharf, helping them navigate tax payment methods and key deadlines. At CIGMA Accounting, we can review whether paying by card makes sense in your circumstances and, where appropriate, talk through other ways of settling a tax bill more efficiently.