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We all know that taxes help fund important government expenditure that we all benefit from, and that the majority of people receive more in public grants, transfers and subsidies than the taxes they pay.
But the yearly ritual of paying our personal income tax bill is not unlike undergoing a medical check-up – you know its good for you, but it’s still unpleasant. But since we need to do it anyway, we figured why not earn some credit card rewards while we contribute to nation-building?
Here’s where CardUp comes in.
How To Use Credit Cards To Pay Your Personal Income Tax Bill To IRAS
According to IRAS, the only accepted methods for paying your income tax bill is via GIRO, AXS, SAM, internet banking, an ATM, or NETS at any SingPost branch.
However, the clever folks at CardUp have devised a totally legal way to allow you to pay for your income tax using your credit card, for a small fee.
For income tax payments scheduled between now till 30 April 2021, new users (or users who have not made a payment before) enjoy a promotional fee of just 1.8% on their recurring (up to 6 times) income tax payment if they redeem their promo code on CardUp, valid for all Singapore-issued Visa cards, Due date of tax payments must be 31 December 2021 at the latest.
Existing users can enjoy a fee of 2.25% on their income tax payments (or all payments) scheduled between now till 31 December 2021 by using the code GET225. Again, this applies to all Singapore-issued Valid on Visa, Mastercard and China UnionPay cards. Due date of tax payments must be 5 January 2022 at the latest.
Aside from income tax, you can also use CardUp for recurring bills like rental payments, insurance premiums, or foreign domestic worker salaries, just to name a few.
#1 Fulfil Qualifying Credit Card Spend Requirement For High-Interest Savings Accounts
Given the fact that many of us are now working from home and there aren’t a lot of places to use our credit cards, some people might find it suddenly more difficult to hit their minimum qualifying spend to earn higher interest on their savings accounts.
By using CardUp, you can now pay for your income tax, which is a substantial expense, while allowing it to count towards qualifying spend that you need.
#2 Clock Up Credit Card Spend To Qualify For Bonus Miles Or Other Rewards
On certain credit cards, you can receive bonus welcome air miles or cashback credit, if you charge a certain minimum amount within the first few months.
With travel plans retail therapy on hold for the foreseeable future, CardUp allows you to still clock up the spending you were counting on.
Furthermore, with the uncertain economic situation, you might be rightly reluctant to make fresh expenditure on new items, while your income tax bill is something you already need to pay for.
#3 Take Advantage Of Promotional CardUp Fees
In the past, the 2.6% fee charged by CardUp was a point that required careful calculation and planning, since it only makes sense if the benefit from your credit card spend must be higher than the fee you pay.
However, the promotional rates of 1.8% to 2.25% (non-Amex) on income tax payments using promo codes means it makes financial sense for a larger pool of people, and those who already plan to use CardUp at the regular fee would simply enjoy even greater savings.
Are There Disadvantages Of Using CardUp For Your Income Tax Bill?
The obvious disadvantage of CardUp is the processing fee you’ll be paying. As mentioned earlier, the monetary value of the air miles, cashback or bonus interest you earn needs to be higher than the CardUp fee you’ll be paying.
To help you evaluate whether it is worth it for you, CardUp has a handy calculator on their website that you can use.
Another potential issue you might face is that CardUp uses variable Merchant Category Codes (MCC), which means you cannot use it to hit a specific type of spend reliably, though the CardUp team will be happy to assist you if you have any questions.
Earn Rewards On Your Personal Income Tax Payment And Other Bills Today
The combination of COVID-19 curtailing our regular spending patterns, the economic recession making us rethink our spending plans, and CardUp’s promotional rates for paying our income tax bill to IRAS makes it a really compelling option right now.
You can visit CardUp for more information and sign-up for a free CardUp account to begin using it to settle your recurring bills, make payments to your landlord or foreign domestic helper, and fulfil your duty as a responsible tax-paying citizen.