How to Pay Canadian Taxes with a Credit Card

Canadian taxpayers can pay their income tax, corporate tax, and GST/HST using a credit card through CRA-authorized third-party payment processors. The most widely used service is PaySimply, which charges a processing fee of approximately 2.5% per transaction. While the fee means you are paying more than the tax amount, the credit card rewards, cash flow flexibility, and on-time payment benefits can make it worthwhile depending on your card and situation.

Last updated: March 2025

How to Pay CRA with a Credit Card

CRA does not accept credit card payments directly. You must use an authorized third-party processor. Here is how it works:

Step-by-Step Process

Go to PaySimply.ca (or another authorized processor)
Select the type of tax payment:
- Personal income tax (T1)
- Corporate income tax (T2)
- GST/HST
- Payroll remittances
- Tax installments
Enter your Social Insurance Number (SIN) or Business Number (BN)
Enter the payment amount
Pay with your credit card (Visa, Mastercard, American Express accepted)
Keep your confirmation receipt — CRA typically processes the payment within 3-5 business days

What It Costs: Processing Fees

Third-party processors charge a fee because credit card companies charge them merchant fees. Here is what to expect:

| Payment Method | Typical Fee | Example on $10,000 Tax Payment |
|—————|————|——————————-|
| Credit card (Visa/MC) | 2.5% | $250 |
| Credit card (Amex) | 2.5% | $250 |
| Debit card | 1.0% | $100 |
| PayPal | 2.5% | $250 |
| Bank transfer (free via CRA directly) | 0% | $0 |

When Paying Taxes by Credit Card Makes Financial Sense

The math only works if your credit card rewards exceed the processing fee, or if the cash flow benefit justifies the cost.

Scenario 1: High-Value Rewards Cards

Premium rewards cards like the American Express Platinum or Cobalt can earn 2-5% back in points value. If your card earns 3% or more in effective rewards value, you come out ahead after the 2.5% fee.

Example: You owe $15,000 in corporate tax. Paying with an Amex card earning 3x points (worth ~3%):

Processing fee: $375 (2.5%)
Rewards earned: ~$450 (3%)
Net benefit: $75 ahead

Scenario 2: Meeting Minimum Spend Requirements

Many premium credit cards offer large sign-up bonuses (50,000 to 100,000 points) if you spend $3,000 to $10,000 in the first 3 months. Using a tax payment to hit that minimum spend can be extremely valuable. A sign-up bonus worth $500 to $1,500 far exceeds the 2.5% processing fee.

Scenario 3: Cash Flow Management

If you owe taxes but your cash is tied up in inventory, paying by credit card gives you 21-55 days of float (depending on your billing cycle). This can be cheaper than CRA’s prescribed interest rate on late payments, which compounds daily.

According to CRA, the prescribed interest rate on overdue taxes is updated quarterly and has been between 8-10% annualized in recent years. A credit card with a 20% annual rate sounds worse, but if you pay the card balance within the grace period, you pay 0% interest on the card while avoiding CRA penalties entirely.

When It Does NOT Make Sense

Your card earns less than 2.5% in rewards — you are paying more in fees than you earn back
You will carry a balance on the card — credit card interest rates (19-22%) far exceed any benefit
You have cash available — paying directly through your bank via CRA My Account is free

What Taxes Can You Pay by Credit Card?

Through authorized processors, you can pay virtually any amount owing to CRA:

Personal income tax (current year balance or prior year reassessments)
Corporate income tax
GST/HST remittances
Payroll remittances (CPP, EI, income tax withholdings)
Tax installments (quarterly payments for individuals or corporations)
Provincial taxes in some cases

Pro tip for installment payments: If CRA requires you to make quarterly tax installments and you do not have an immediate tax balance owing, you can still pay installments by credit card to earn rewards. This is one of the highest-value uses of credit card tax payments.

CRA-Authorized Payment Processors

Note: Fee percentages and available processors change periodically. Check the processor’s website for current rates before making a payment.

Frequently Asked Questions

Can I pay my Canadian taxes with a credit card?

Yes. While CRA does not accept credit cards directly, authorized third-party processors like PaySimply and Pay.canada.ca allow you to pay any CRA balance owing using Visa, Mastercard, or American Express. A processing fee of approximately 2.5% applies.

Is the credit card processing fee tax deductible?

If you are paying business taxes (corporate tax, GST/HST), the processing fee is a deductible business expense. For personal tax payments, the fee is not deductible.

How long does a credit card tax payment take to reach CRA?

According to PaySimply, payments are typically processed and forwarded to CRA within 3-5 business days. Plan accordingly if you are paying close to a deadline.

Can I pay CRA from a US credit card?

Yes, most processors accept international credit cards. The payment will be processed in Canadian dollars, and your card issuer will apply their foreign transaction exchange rate and any applicable foreign transaction fees.

Need Help With Tax Payments?

If you are a Canadian business owner or Amazon seller looking for the most tax-efficient way to handle your CRA obligations, contact us. We can help you plan your payments, installments, and cash flow strategy.