A major change to Australia’s superannuation system is coming, and it will directly affect how small and medium-sized enterprises (SMEs) manage payroll.
From 1 July 2026, employers will be required to pay their employees’ superannuation guarantee (SG) at the same time as salary and wages. This reform, known as Payday Super, is designed to reduce unpaid super, improve transparency and strengthen employees’ retirement savings.
As your accounting and tax partner, we want to ensure your business is ready well before the deadline.
The days of paying your super guarantee (SG) contributions quarterly are ending.
From 1 July 2026, you will be required to pay your employees’ super at the same time as their salary and wages.
Super contributions must reach your employees’ super fund within 7 business days of their payday. In this context, payday is the day you make a Qualifying Earnings (QE) payment to your employee.
QE is the total amount your super is calculated on. It’s a broad term that includes:
For many SMEs, this is a fundamental shift in operations. It will have a direct and immediate impact on your business cash flow, as you will no longer be able to hold onto those super funds for up to three months. You will need to have the cash ready for every single pay run.
As part of the Payday Super reforms, the Australian Taxation Office (ATO) is tightening how it enforces late or missing super payments. These changes aim to ensure employees receive their super on time and to encourage employers to stay compliant.
If you don’t pay your employees’ super in full and on time, you’ll be liable for the Superannuation Guarantee Charge (SGC).
What the SGC includes:
Additional charges for late SGC payments:
Once the SGC has been assessed, further penalties can apply if it remains unpaid:
Two key policy changes:
The government’s free super payments portal, the SBSCH, will be phased out as part of the Payday Super reforms. It will close to new users from 1 October 2025 and will be fully decommissioned on 1 July 2026.
What this means for your business:
If you currently use the SBSCH, you must transition to a new, commercial payroll solution before this date.
Modern payroll software (like Xero, MYOB, Reckon, etc.) already handle super payments seamlessly. If you aren’t using one, it’s time to make the switch. These systems are designed for ‘Payday Super’ and will be essential for compliance.
Your Single Touch Payroll (STP) reporting will also be updated. You’ll soon be required to report both the “Qualifying Earnings” (the amount super is calculated on) and the super liability with each pay event.
The ATO understands this is a massive operational change for businesses.
The ATO have released a draft compliance guideline for the first year (the 2026-27 financial year). The message is clear: In the first year, the ATO will not focus their audit resources on employers who are genuinely trying to do the right thing and quickly fix any errors.
“Payday Super” is a major change to your cash flow and payroll systems, but we are here to make this transition simple and stress-free.
Please get in touch so we can make sure you’re ready.
Source: ATO
Compiled & Edited by Tailored Accounts
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