First the good news: you can now pay your tax bills by Debit, Laser and Credit card, as Revenue have added real-time Payments Gateway functionality to their ros.ie website.
But there is a catch: if you use this facility to pay by Credit Card, you will be charged a 1.49% “transaction charge”.
And if you use it often, it will get costly. For example, a €7,000 VAT bill paid by credit card will attract a “transaction charge” of over €110.
Revenue emphasise that their “transaction charge” is “purely related to third party fees incurred by Revenue, in the provision of this service”. Its worth noting that Ryanair use very similar language to justify their (very profitable) credit card fees.
Although I don’t agree, a cynic could point out that it could actually be cheaper for a business to pay their VAT bills up to eight weeks late (interest @ 0.274% per day, approx 0.85% per month) by any other method, than on time via credit card with a 1.49% fee attached. Of course, late tax payments may also attract tax surcharges and increased risk of audit, so don’t go there.
In addition, on the basis that Revenue’s card fee is purely a “transaction charge”, I am assuming that its cost will be tax-deductible for a business. This is not the case of course for the interest that Revenue charge on late payments.