How to Pay Income Tax with a Credit Card in India — Step-by-Step (2026)
Can you pay income tax with a credit card in India? Yes — here is the complete step-by-step guide including gateway fees, which cards still earn rewards, and...
Every March and July, millions of Indians scramble to pay advance tax or self-assessment tax. Most use net banking or UPI. But here is something most people do not realise: you can pay your income tax using a credit card — and with the right card, you can even earn rewards on a payment that can run into lakhs of rupees.
This guide walks you through the exact process on the income tax e-portal, the gateway fees involved, and — most importantly — which credit cards still reward government payments in 2026.
Key update for 2026: Most major credit cards (HDFC, SBI, Axis consumer cards) stopped rewarding government MCC transactions from late 2024. However, a handful of specific cards still do — and we have listed them below. Always check current MITC before making a large tax payment on credit.
Step-by-Step: How to Pay Income Tax via Credit Card on the e-Tax Portal
Step 1 — Go to the income tax e-filing portal: Visit incometax.gov.in. Log in with your PAN and password.
Step 2 — Navigate to e-Pay Tax: On the dashboard, click on 'e-File' → 'e-Pay Tax'. Or directly use the URL: incometax.gov.in/iec/foportal/help/e-pay-tax-functionality.
Step 3 — Enter payment details: Select the Assessment Year, Tax type (Advance Tax / Self Assessment Tax / Regular Assessment Tax etc.), and enter the amount.
Step 4 — Choose your payment method: On the payment screen, select 'Credit Card' from the available options. Currently supported gateway: Axis Bank Payment Gateway and HDFC Bank Payment Gateway on the income tax portal.
Step 5 — Enter card details: Enter your credit card number, expiry, CVV, and cardholder name. Complete OTP verification.
Related reading: Hidden Credit Card Charges.
Step 6 — Review gateway charges: Before final confirmation, the portal will show the gateway/convenience fee (approximately 0.9% to 1.0% + 18% GST on the fee). Example: On a Rs 50,000 tax payment, the fee is approximately Rs 450 + Rs 81 GST = Rs 531 extra.
Step 7 — Download receipt: After successful payment, download the Challan receipt (Form 280). This is your proof of tax payment — save it for your ITR filing.
What Is the Gateway Fee and Is It Worth It?
| Tax Amount | Gateway Fee (approx 0.9% + GST) |
|---|---|
| Rs 10,000 | Rs 90 + Rs 16.2 = Rs 106 |
| Rs 50,000 | Rs 450 + Rs 81 = Rs 531 |
| Rs 1,00,000 | Rs 900 + Rs 162 = Rs 1,062 |
| Rs 5,00,000 | Rs 4,500 + Rs 810 = Rs 5,310 |
Whether the fee is worth it depends on your credit card's reward rate on this transaction. If your card earns 2% rewards and the gateway fee is 1%, you net 1% — still positive. If your card earns 0% on government MCC (like most HDFC and Axis consumer cards post-2024), you pay 1% for no benefit.
Which Credit Cards Still Earn Rewards on Income Tax Payments in 2026?
Major consumer cards from HDFC, Axis, and SBI stopped earning reward points on government MCC (Merchant Category Code 9311) transactions from November 2024 onwards. Tax payments fall under government MCC. Check your specific card's MITC before assuming you will earn rewards.
Related reading: Best Cashback Credit Cards India.
Cards that currently still reward government/tax payments (verify current terms before use):
| Card | Reward on Tax Payment |
|---|---|
| HDFC BizBlack Metal (business card) | 3.3% on government payments up to Rs 56,250/month |
| Standard Chartered Ultimate | Points earned (verify current MITC — SC was acquired by Federal Bank) |
| ICICI Times Black | Points on government MCC — verify with ICICI before large payment |
| Amex Membership Rewards cards | MR points on tax payments (government MCC rewards not specifically excluded) |
| Most HDFC consumer cards (Regalia, Infinia, Millennia) | NOT rewarded on tax payments since late 2024 |
| Axis Magnus, Atlas, Ace | NOT rewarded on government MCC since 2024 |
| SBI cards | NOT rewarded on government MCC |
The HDFC BizBlack Metal card is currently the standout option for tax payments among high-value payers — 3.3% on government MCC up to Rs 56,250/month means you can earn rewards on up to Rs 1.7 lakh of tax payments monthly. At 3.3% vs 1% gateway fee, net gain = 2.3%.
Should You Pay Tax by Credit Card? A Decision Framework
| Situation | Recommendation |
|---|---|
| Your card earns 2%+ on government MCC | Pay by credit card — net positive even after gateway fee |
| Your card earns 0% on government MCC | Pay via net banking or UPI — no gateway fee, no reward, but zero extra cost |
| You want to defer payment by 30-45 days | Credit card gives you the billing cycle float — useful for cash flow management |
| You cannot pay the full credit card bill | Avoid credit card — tax payment debt at 40% annual interest far outweighs any convenience |
Alternative Tax Payment Methods — Comparison
| Method | Fee |
|---|---|
| Net banking | Zero |
| UPI (up to Rs 2 lakh) | Zero |
| Credit card | 0.9–1.0% + 18% GST on fee |
| RTGS/NEFT from bank | Zero |
| Debit card | Same as credit card gateway fee |
Important: Credit Card Tax Payment and Cash Flow
Paying a large tax amount on a credit card shifts the cash outflow from today to your next credit card due date — typically 15 to 45 days later. If your advance tax is due on March 15 and your credit card due date is April 5, you effectively get a 21-day interest-free extension.
This is useful for cash flow management but only if you are absolutely certain you can pay the full credit card bill by April 5. If you carry the balance forward, the interest at 36% to 42% annually will cost far more than any reward earned.
Frequently Asked Questions
Q: Is income tax payment via credit card safe?
Yes — the income tax e-portal uses standard bank-grade security. OTP verification ensures only you can complete the transaction.
Q: Can I pay GST using a credit card on the GST portal?
Yes — the GST portal also accepts credit card payments via similar gateway partners. The same reward logic applies — check if your card rewards GST payments (also government MCC).
Q: Will a large credit card tax payment affect my CIBIL score?
Only if it pushes your credit utilisation ratio significantly above 30%. A Rs 1 lakh tax payment on a Rs 2 lakh limit card takes utilisation to 50% — which temporarily affects your score. On a Rs 5 lakh limit card, it is 20% — no concern.
Related reading: Credit Utilisation Ratio Explained.
Q: Can I get a refund if I overpay tax via credit card?
Yes — income tax refunds are processed to your bank account regardless of how you paid. The refund is not reversed to the credit card.