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Can You Pay CRA with a Credit Card?
May 14, 2025
Quick Answer
While the Canada Revenue Agency (CRA) does not accept direct credit card payments, you can pay your tax bill with a credit card through a third-party service provider.
Should You Pay Cra With A Credit Card?
Deciding whether to pay your taxes by credit card involves weighing the pros and cons.
Benefits of Paying Taxes With a Credit Card
- Earn Rewards: You can accumulate points, miles, or cash back on the transaction, potentially offsetting some of the cost.
- Convenience: Paying online with a credit card is a quick and straightforward process that ensures your payment is received on time.
- Short-Term Flexibility: It provides a way to pay your tax bill by the deadline even if you lack the immediate funds in your bank account.
- Meet Spending Requirements: A large tax payment can help you meet the minimum spend threshold for a new credit card's valuable sign-up bonus.
Drawbacks of Paying Taxes With a Credit Card
- Processing Fees: The CRA uses third-party payment providers that charge a non-refundable percentage-based fee for every transaction.
- High Interest Rates: If you carry the balance on your card past the due date, the high interest charges will quickly outweigh any benefits gained.
- Negated Rewards: The processing fee is often higher than the value of the rewards earned, resulting in a net loss on the transaction.
How to Pay Cra With A Credit Card
Paying your taxes to the Canada Revenue Agency (CRA) with a credit card is a convenient option available through third-party providers. Here’s a general guide to navigating the process.
- Select a Third-Party Provider: The CRA does not accept direct credit card payments. You must use an authorized third-party service that processes the transaction for a fee. Research the current CRA-approved providers to find one that suits you.
- Choose the Right Credit Card: Since payment providers charge a service fee, consider using a card with high rewards to help offset the cost. A resource like the Kudos' Explore Cards tool can help you compare options.
- Prepare Your Information: Before initiating the payment, have your details ready. This typically includes your Social Insurance Number (SIN) or Business Number (BN), the exact amount you owe, and the relevant tax year or reporting period.
- Complete the Transaction: Follow the instructions on your chosen provider’s website. You will enter your personal and tax information, the payment amount, and your credit card details. Review all information for accuracy before confirming the payment.
- Keep Your Receipt: After the transaction is complete, you will receive a confirmation number and a receipt. Save this information for your records as proof of payment. Note that it may take a few business days for the payment to reflect on your CRA account.
Impact On Your Credit Score
Using a credit card for your payments can affect your credit score in several ways, both positively and negatively. Here are the key factors to consider to maintain a healthy credit profile.
- Credit Utilization Ratio. A high balance increases your credit utilization, which can lower your score. Lenders prefer to see you using less than 30% of your available credit at any given time.
- Payment History. Consistently making on-time payments is one of the most significant factors in a good credit score. Late payments can stay on your report for years and negatively impact it.
- New Credit Inquiries. Applying for a new credit card results in a hard inquiry on your credit report. Multiple hard inquiries in a short time can temporarily lower your score.
Alternative Ways To Pay Cra
Pay Directly From Your Bank Account
You can pay your taxes directly through your financial institution's online banking service, treating it like any other bill payment. The Canada Revenue Agency also provides its "My Payment" service, which accepts payments via Interac Online, Visa Debit, or Debit Mastercard. This offers a secure way to pay directly from your bank account, bypassing the need for a credit card and avoiding third-party processing fees.
Set Up a Pre-Authorized Debit
For a more hands-off approach, you can establish a pre-authorized debit (PAD) agreement through your CRA My Account. This authorizes the CRA to withdraw a predetermined amount directly from your bank account on specific dates you choose. This method is useful for making single payments or setting up a series of installments, ensuring your obligations are met on time without manual intervention for each payment.
Choose the Right Card to Pay Cra
Paying off your credit card debt is a huge step, but what comes next? Ensuring you have the right card for your spending habits is crucial for maximizing rewards, minimizing fees, and accessing the best perks. Instead of guessing, you can use a personalized recommendation engine to compare nearly 3,000 cards and find your perfect match based on your unique preferences.
For those who want to elevate their online shopping, Kudos is the ultimate free tool for earning more rewards. Plus, we have a special offer: get $20 back on your first qualifying purchase when you sign-up for free with the code “GET20” and shop at a Boost merchant.
Frequently Asked Questions
What are the fees for paying the CRA with a credit card?
Third-party providers charge a convenience fee, typically ranging from 1.5% to 2.5% of your total payment amount.
Will I earn rewards points on my CRA payment?
Yes, most credit card issuers will award points or cash back, which can help offset the convenience fees.
How long does it take for the payment to reach the CRA?
Payments usually take two to three business days to process, so be sure to pay ahead of any deadlines.
Supercharge Your Credit Cards
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Editorial Disclosure: Opinions expressed here are those of Kudos alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.
