Stuck at Tax Return Because of The Coles Mastercard Gift Card

amorphous2111 on 28/11/2023 - 16:53
Last edited 28/11/2023 - 19:50 by 1 other user

Hi, just wonder if anyone here is in the same situation and how to procced.

I prepaid a few grands into my ATO account using the Coles Mastercard gift card in the previous deals. That made my tax return stuck at Balancing account since they cannot pay it back in cash. I called the ATO and got told that someone will manually process that fund back into the cards, which I still have.

But it’s been almost 4 months with multiple calls, it is still there. The guys at ATO can only advise me to wait.

Any of you are/were in the stuation, and if so how did you get them to look at your tax?

Cheers.

A

Financial ATO Gift Card

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Comments

  • Mechz on 28/11/2023 - 16:55
    +53

    These hacks never end well.

    • bobbified on 28/11/2023 - 17:06
      +9

      Can't really call it a 'hack' if it doesn't actually work! 😂

    • Gunnar on 28/11/2023 - 20:14
      +8

      One of the things I’ve learnt on Ozbargain is don’t use gift cards. It’s fine until something happens and you have to reverse the transaction

      • Mechz on 28/11/2023 - 22:03
        +6

        NBGC - Never Buy Gift Cards

      • bargaino on 28/11/2023 - 23:25
        +1

        The only good gift cards are issued by the reserve bank.

        • The Hawk on 29/11/2023 - 09:24

          Universal gift cards!

      • DingoBilly on 29/11/2023 - 16:02
        +2

        Yeah the gift cards are pretty rough and can easily burn you.

        I'm surprised how many people go apeshit over them though so they can get $1 cashback. They're usually some of the most up voted deals even though people could easily save significantly more doing other things.

  • Dollar General on 28/11/2023 - 17:03

    I don’t know of the ATO & they don’t know of me. Can’t help

  • Jimothy Wongingtons on 28/11/2023 - 17:07
    +7

    ADAGCHS

    • Jimothy Wongingtons on 28/11/2023 - 17:07
      +3

      cc @mapax @Muzeeb

      • mapax on 28/11/2023 - 17:39
        +2

        ADAGCHS indeed!

    • Guybrush57 on 28/11/2023 - 19:40
      +2

      Ah Damn Another Gift Card Horror Story?

    • Gunnar on 28/11/2023 - 20:15
      +7

      Using a gift card to pay off a government debt, what could possibly go wrong?

      • Jimothy Wongingtons on 28/11/2023 - 20:21
        +2

        Hey at least the actual ato did receive the funds lmao

    • Lurk Hartog on 29/11/2023 - 08:37
      -1

      IDSPISPOPD

  • tekisei on 28/11/2023 - 17:15
    +9

    Could you just leave it there until you need to pay more tax next FY?

    • amorphous2111 on 28/11/2023 - 21:05

      Yes I could, but in the end I had few grands more of tax return as I put a large sum into my super at the end of June. So would be nicer to at least get that return in cash.

      • tooblue on 29/11/2023 - 02:48
        +7

        Nice try to use ATO to launder your money.

  • Sye on 28/11/2023 - 17:17
    +44

    This is why you shouldn't use Coles MasterCard Gift Cards to pay the ATO. Just stick to using iTunes gift cards.

  • magster on 28/11/2023 - 17:17
    +5

    I warned people it wasn’t going to work

  • brendanm on 28/11/2023 - 17:24
    +15

    Why in god's name would you prepay the ATO.

    • Nugs on 28/11/2023 - 17:43
      +2

      To avoid having cards hacked and drained?
      I've prepaid council rates and electricity beforehand
      .

      • SBOB on 28/11/2023 - 18:16
        +5

        Yeah but you don't overpay and then expect to deal with refunding part of the funds.
        One way tx only :)

      • brendanm on 28/11/2023 - 18:18

        That's not the ATO though.

  • blitz on 28/11/2023 - 17:29
    +8

    I prepaid a few grands into my ATO account using the Coles Mastercard gift card in the previous deals.

    Sorry, but this whole idea just sounds ridiculous.

  • TightLikeThisx on 28/11/2023 - 17:52
    +2

    Using the ATO to launder your dirty cash?

    “The impediment to action advances action. What stands in the way becomes the way.”
    ― Marcus Aurelius

  • shap08 on 28/11/2023 - 17:53

    This is going to be a PITA to do

  • AustriaBargain on 28/11/2023 - 17:54

    Can't they just cut you a cheque?

  • bobbified on 28/11/2023 - 17:56
    +4

    It'll be funny if they refunded back into the prepaid cards that's already been chucked away! lol

    • scanuck on 01/12/2023 - 00:05

      I’m getting anxiety just thinking about this

      Where have I used these cards…

  • ragrum on 28/11/2023 - 18:38
    +2

    As far as I know, income tax refunds go to the account you provide at https://onlineservices.ato.gov.au/Individual/FIA#FinancialIn…
    I've never heard of the ATO insisting that refunds need to go to the account/card that payments were made from. For most people that would mean paying refunds to your employer's bank account.

    Edit: Is the problem that the ATO is saying that because you paid with a prepaid card specifically, they won't follow the normal process of paying out to your bank account? I could imagine them having a policy like that for fraud or perhaps anti-money laundering reasons.

    • amorphous2111 on 28/11/2023 - 21:00

      If they don’t take your money (e.i. no tax to pay), then it goes back to the original form of payment.

      I am ok with that except that it’s taking too long.

  • bemybubble on 28/11/2023 - 18:56
    +1

    Call ATO complaints. They’re really good to deal with.

    If you get no where with them. Then the IGT

  • xuqi on 28/11/2023 - 19:18

    "and if so how did you get them to look at your tax?"

    Yeah, nah, no way I'd want to be pestering tax officials for any reason what-so-ever.

    Best of luck op with your next hack……

  • plmko on 28/11/2023 - 19:50
    +1

    It's not that bad you get 4% interest

  • Levathian on 28/11/2023 - 19:59
    +2

    I did the same thing but luckily the amount I overpaid was only $25 (what I mean is, I put $1500 in as I knew I would have a tax debt and it almost covered it all). It did get refunded to my bank account but my return was stuck at “balancing” for over a week.

    • amorphous2111 on 28/11/2023 - 21:02

      Yes mine is at “balancing” for a few months. Every time I called them I was advised that mine is already at the top of the pile but nothing happened then.

  • benwaffle on 28/11/2023 - 23:23
    +4

    Wasn't OP the one who did something similar with AGL and having similar issues…….
    https://www.ozbargain.com.au/node/686708

  • SmiTTy on 29/11/2023 - 00:23
    +4

    I've never had an issue with paying ATO with coles giftcards. But then again ive never overpaid

  • wangasm on 29/11/2023 - 03:59
    +1

    Yeh don't try to overpay/launder money through your tax account when you aren't expecting a debt. There are examples of others trying this with similar results.
    Here
    Here
    Here

  • minniethemoocher on 29/11/2023 - 13:39

    You should lodge a complaint if it’s been 4 months

    • amorphous2111 on 29/11/2023 - 14:49

      I will write to them. It’s all good actually just took too long. I keep all the cards I used.

  • Central Intelligence on 29/11/2023 - 15:51

    Balancing is a normal process, you should not have asked for support because now there is the possibility you have drawn attention to your professional cashback activities.

    As far as I know the balancing only disappears once your notice of assessment been issued. Your multiple inquiries have probably flagged you for something. Let's hope you did not tell them something you should not have during those conversations/letters.

    You might want to seek some tax advice on whether the gains you have made from the gift cards are taxable as assessable income. The main issue I can foresee is that when you buy those gift cards, you are paying cash to get a cash equivalent back which could be regarded as income as you have made a gain instantly. I know there authorities which state doing an activity to save money is not deemed to be income, which would be like cashrewards, but here the facts are different and a bit fuzzy…

    I'm not sure if the commissioner wants to take you on, but the longer the wait, the more likely you are going to have an adverse outcome. It is unclear how that case would come out given I don't know your circumstances in full and you probably shouldn't tell us anyway to avoid any prying eyes. It would be interesting to see how any case pans out if you decide to take it to the courts.

    All I know is that balancing is normal. My tax return usually stays balancing for a few weeks but then once the notice of assessment is issued then it clears itself out. I prepay my tax bill, but not to a point where I get a refund with the exception of the IEP which has been automated recently. I also have no experience with prepaying ATO tax bills with gift cards…

    Hope all pans out well though.

    • amorphous2111 on 29/11/2023 - 19:28

      Thanks. My tax is pretty simple anyway.

      For the “discount gift card income”, my view is that it is not a problem. First: we exchange cash to a more limited form of payment so that there is no basis to determine a monetary gain. Second, the expense is likely offset any gain, if any. For example if you have to drive around the city to find 5 cards, then your gain of $85 can easily be offset by the cent to km alone.

  • BudgetBountyOz on 30/11/2023 - 14:54

    The ATO has changed the system so that you cannot make a profit by making payments to the ATO using prepaid gift cards and then requesting a refund.

    If payments are made using prepaid gift cards, refunds must be made to the original payment method, the prepaid gift cards.

    If you lodge a tax return when your account is in credit from the gift cards, your tax return refund cannot be processed until the original payment is cleared.

    You have a few options:

    1. Request refunds to prepaid gift cards for tax payments then request tax return refund (if you still have the gift card numbers)
      You can use the balance somewhere else.

    2. Leave the balance in the account and offset it with the payable from future tax returns.

    3. Raise Voluntary PAYG Income Tax instalment for the current financial year then request the balance transfer to the integrated client account for instalment payment.
      I have not tried the balance transfer so best to check with the ATO first.

    • amorphous2111 on 30/11/2023 - 16:44

      Thanks. They will refund to my cards, just takes too long and the guys in the ATO can only tell me to wait.

    • trapper on 30/11/2023 - 16:58

      Leave the balance in the account and offset it with the payable from future tax returns.

      This seems like the simple approach imho. It all works itself out in the end.

  • Exorcist on 30/11/2023 - 15:36
    +1

    They should charge you for clogging up the helpline even more

  • Drakesy on 30/11/2023 - 15:37
    +1

    If you F around you find out.

    Honestly though the Gov has been cracking down on this loophole for years as people would use tax as a vehicle to amass bulk points. Government would then be stung with a 2% fee.

    I think AMEX is the last one standing?

  • Aerith-Waifu on 30/11/2023 - 16:39

    Same thing happened to me but ATO paid into my bank account after my tax return was lodged. That's why I always add these gift cards when it's near the tax return times and not before

    • amorphous2111 on 30/11/2023 - 16:48

      Yes I was anticipating some tax.

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