PAYDAY SUPERANNUATION: WHAT EMPLOYERS NEED TO KNOW

One of the most significant changes to Australia’s superannuation system in years is now taking effect. From 1 July 2026, the way employers pay superannuation guarantee (SG) contributions is fundamentally changing — and if you employ staff, this affects you immediately.

What’s changing from 1 July 2026?

Previously, employers were required to pay employees’ superannuation contributions at least once every quarter.

Here’s what changes from 1 July 2026:

• Super guarantee payments must be made by employers at the same time as wages (as opposed to the previous framework which required contributions to be made quarterly). This means that if you run weekly, fortnightly, or monthly payroll, super payments must now follow that same pattern — every single pay cycle.
• Contributions must be received by the employee’s super fund within 7 business days of payday, otherwise superannuation guarantee charge (SGC) will apply. The exceptions are:
  • • First contribution for new employee – Within 20 business days of the first payday
    • First contribution to a new super fund for an existing employee – Within 20 business days of the first payday after the notified change
    • Out-of-cycle payments (such as one-off bonuses, commissions or back-payments that fall outside of the regular timing of pays for an employee)  – Within 7 business days of the next payday for the employee that is in their regular cycle

  The ATO can also issue determinations of Exceptional circumstances, for example in the case of natural disasters or widespread communication outages. In these cases the deadline will be within 20 business days of the affected payday or of the determination date, whichever is later. Detailed explanations and examples of specific deadlines are available on the ATO’s website.

• Super guarantee will be calculated on the new concept of “qualifying earnings” (as opposed to the previous “ordinary time earnings”).
• The superannuation guarantee charge (SGC) framework is changing –
  • There are changes to the components of SGC and the method of calculation.
  • SGC will be tax-deductible (currently not deductible).  However, penalties or interest after the assessment will not be deductible.
• STP reporting will be updated to reflect ‘qualifying earnings’ and superannuation guarantee amounts.
• The Maximum Contributions Base will change to an annual limit of $250,000 (previously $62,500 per quarter).
• The ATO Small Business Super Clearing House (SBSCH) will be decommissioned on 1 July 2026.

What are the consequences of late payment?

The superannuation guarantee charge applies where amounts are not received by a super fund by the relevant deadline (generally 7 days after payday).  The charge is assessed by the ATO (employers no longer lodge a super guarantee statement), and includes an administrative uplift amount designed to reflect enforcement costs and encourage early disclosure. Penalties can reach a maximum of 200% of the super guarantee charge.

Importantly, real-time STP reporting of qualifying earnings and SG payments means the ATO can now readily identify unpaid or late superannuation — so the days of quarterly obligations slipping through the cracks are over.

First-year compliance approach

The ATO has released PCG 2026/1, which outlines a risk-based compliance approach for the first year of Payday Super (1 July 2026 to 30 June 2027). This provides some transitional relief for employers acting in good faith, but it does not remove the underlying obligation — and it does not apply beyond 30 June 2027.

Steps to take now

There are steps you need to take now to ensure you are compliant with the new Payday Super requirements. Download our Payday Super Checklist now.