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Payday super is set to change the way that all Australian businesses are required to make contributions of Superannuation Guarantee amounts on behalf of their employees. But what does this mean in practical terms for you and your business, and how should you prepare? We’ve set out the key points below:
What is changing?
- From 1 July 2026, employers will be required to make payment of Superannuation Guarantee contributions on the same date as the regular payday.
- Contributions will need to reach employee super fund accounts within 7 business days. This is changing from the previous quarterly obligation.
- There are also some changes to payments which attract the SG. This is under a new definition of “Qualifying Earnings” – expanding the existing “Ordinary Time Earnings” category) – which includes some salary sacrificed amounts and certain payments of commission.
- Employers will need to report their QE and SG liabilities to the ATO through Single Touch Payroll.
Who is impacted?
- All businesses paying wages to employees in Australia will be required to comply with payday super obligations.
Are there any exceptions?
- Payments to new employees are deferred until after their first two weeks.
- Small and irregular payments outside of the employees’ regular pay cycle are not considered a ‘Payday’, so do not count as QE.
What are the consequences?
- Employers who fail to meet the payday super requirements will face a new “superannuation guarantee charge”. This is calculated by the ATO based on the Qualifying Earnings, and includes interest compounding daily at the general interest charge rate, and an administrative uplift fee of up to 60% of the total shortfall.
What should you do now?
- If you do not already make superannuation contributions in accordance with your pay cycle, you do not have to wait until 1 July 2026 to do so!
- Now may also be a good time to revisit your employment contracts – are all of your employees’ pay periods aligned? This may be a small fix you can make to reduce administrative burden.
- Seek financial or accounting advice if needed.
