Tax advance

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The contents provided on this page are for informational purposes only and do not constitute financial advice. Consider your personal circumstances and objectives before making any financial decisions.

As tax season rolls around in Australia, you might come across services offering to give you access to your tax refund before the ATO processes it. These are called tax refund advance loans — and while they can be a helpful way to get your money sooner, it’s important to understand how they work and what to look out for.

Beforepay offers a tax refund advance product that gives you access to a portion of your expected refund with a clear, fixed fee — making it a simple and transparent option compared to traditional tax advance loans.

This guide explores how tax advances work, when they might be a good fit, and how Beforepay's approach compares to other options.

What is a tax advance?

A tax advance is a short-term loan that provides access to a portion (or all) of your expected tax refund before it's officially processed by the ATO. These loans are typically offered through tax agents, accounting firms, financial services companies, or through providers like Beforepay.

How does a tax advance work?

You lodge your tax return through a participating provider.
Based on your estimated refund, they offer you an advance.
When the ATO processes the return and issues your refund, the advance and any fees are repaid from your final amount.

Find out more about how to access a tax refund advance with Beforepay.

Why people use tax advances

Speed: The ATO can take up to two weeks (or longer) to process refunds.
Urgent bills: A refund may be needed for rent, bills, school costs, or other priorities.
No other savings: For many households, the tax refund is their biggest annual financial boost.

The tax advance risks and costs to watch for

While getting money early can be helpful, some tax advance products can come with drawbacks:

High fees: Some charge application fees, set-up fees, or daily interest.
Reduced refunds: After repayments and fees, you could receive less than expected.
Unexpected outcomes: If your final refund is lower than estimated, you might still owe money.
Limited availability: Not all tax agents offer advances, and eligibility can be restricted.

A real-world example of a tax advance

You're expecting a $2,500 tax refund and urgently need money to cover overdue utility bills. A tax advance provider offers you $2,000 upfront with a $150 fee.

When the ATO pays your $2,500 refund, the provider deducts the $2,150, leaving you with $350.

If the ATO adjusts your return and only pays $2,100, you still owe the $2,150, meaning you'd be left owing $50 out of pocket — even after your refund is paid.

How Beforepay’s tax advance is different

Beforepay’s tax advance, offered in collaboration with H&R Block, is designed to be simple, fair, and transparent.

When you apply for a tax advance through Beforepay:

You can access up to 50% of your estimated refund, capped at $1,000.
You pay a fixed 5% fee — no interest, no late fees, no hidden charges.
There’s no risk of compounding fees or debt spirals.
Your repayment is automatically deducted from your refund once it’s processed by the ATO and received by H&R Block.
The process is fast – funds can be available within minutes after lodging your return and verifying eligibility.

This structure gives you a fast and predictable way to access your refund money sooner, without the risk of unexpected debt if the ATO adjusts your return.

When a tax advance might make sense

A tax advance could be the right choice if:

You have already lodged or are about to lodge your return.
You have a high level of certainty around your expected refund.
You urgently need access to funds for a specific purpose.
You understand and are comfortable with the fees and terms involved.

When to be cautious about a tax advance

Think carefully if:

Your refund amount is uncertain or complicated.
Fees aren't clearly explained.
You're considering using a tax advance repeatedly to cover cash flow issues.
You haven’t explored other affordable options.

Final thoughts

Tax advances offer a way to access your expected refund earlier — but it's important to choose a service that puts transparency, fairness, and your financial wellbeing first.

Beforepay’s tax refund advance is built to provide a simple, predictable, and responsible solution. With a clear 5% fee, no ongoing interest, and repayments aligned to your pay cycle, it's a smarter way to access your money without the uncertainty often found in traditional tax advance products.

Learn more about how Beforepay can help you access your tax refund sooner.

Disclaimer: Beforepay Group Ltd, ABN: 63 633 925 505. Beforepay allows eligible customers to access their pay and provides budgeting tools. Beforepay does not provide financial products, financial advice or credit products. The views provided in this article include factual information and the personal opinions of relevant Beforepay staff and do not constitute financial advice. Beforepay and its related bodies corporate make no representation or warranty, express or implied, as to the accuracy, completeness, timeliness or reliability of the contents of this blog post and do not accept any liability for any loss whatsoever arising from the use of this information. Please read our Terms of Service carefully before deciding whether to use any of our services.