Unfortunately, for individuals, it is not possible to claim interest on money borrowed to pay your income tax. Expenses are only deductible if they are incurred in gaining or producing assessable income or necessarily incurred in carrying on a business for the purpose of gaining or producing such income. A payment of income tax plays no part in the derivation of assessable income. see Case V48, Administrative Appeals Tribunal of Australia, 25 February 1988 http://www.iknow.cch.com.au/#!/docu...ppeals-tribunal-of-australia-25-february-1988 s25-5(2)(c) ITAA97 expressly prohibits interest on borrowing money to pay tax. http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s25.5.html Credit Card Fees on transactions to pay tax And you might get frequent flyer rewards, but you cannot claim a credit card fee incurred on paying a tax bill: ID 2010/159 https://www.ato.gov.au/law/view/document?docid=AID/AID2010159/00001 ID 2010/160 https://www.ato.gov.au/law/view/document?docid=AID/AID2010160/00001 Business It seems the ATO accept that a ‘business’ can borrow to pay tax and claim the interest in some circumstances. This includes sole traders. IT 2582 Income tax : deductibility of interest incurred on moneys borrowed to pay income tax (1990) https://www.ato.gov.au/law/view/document?locid='ITR/IT2582/NAT/ATO' ID 2006/269 Income Tax Deductions and Expenses: interest incurred on moneys borrowed by a sole trader to pay income tax https://www.ato.gov.au/law/view/document?docid=AID/AID2006269/00001 Partners But partners cannot borrow to pay tax, and claim the itnerest, TD 2000/24 (see also tax tip 66 on the refinancing principle) CASE 14/98, Administrative Appeals Tribunal of Australia (Victoria), 28 July 1998 http://www.iknow.cch.com.au/#!/document/atagUio538768sl16704323/case-14-98 General Interest Charge The GIC is deductible against other income. GIC is interest the ATO charges on late tax payments. s29-5(1)(c) ITAA97 http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s25.5.html The GIC is around 9.14% at the moment, so if you cannot afford to pay your tax with cash it is still worthwhile considering borrowing the money from a LOC etc so you will get a lower interest rate - but the interest is not deductible. Make sure you don't end up with mixed purpose loan either.