The Australian Taxation Office (ATO) is urging employers to start preparing now for the introduction of Payday Super, a fundamental change to how superannuation guarantee contributions (SG) are paid. From 1 July 2026, super will no longer be paid quarterly, it will need to be made on each payday alongside wages and salaries.
This reform represents one of the most significant changes to employer super obligations in decades and will have direct implications for payroll teams across Australia.
What Payday Super means for employers
Under the new rules:
- Employers must pay SG contributions at the same time wages or salary are paid rather than on a quarterly basis.
- Contributions must arrive in the employee’s nominated super fund within seven business days after each payday.
- For new employees, the first super payment has an extended timeframe of 20 business days from payday.
The shift aims to ensure employees receive super contributions more regularly and on time. It will also help employers manage super liabilities more transparently and reduce the risk of unpaid super issues.
What payroll teams should do now
The ATO is clear that the time to prepare systems, processes and people is now, not July 2026. The reforms affect payroll operations at multiple levels and may require changes to software, workflows and compliance practices.
Here’s a practical preparation checklist for payroll professionals:
Review your payroll and super systems
Check with your payroll software provider to understand how Payday Super functionality will be supported. Many systems are being updated to include new reporting requirements and automatic calculation of qualifying earnings.
Align payment schedules
Assess how current pay cycles (weekly, fortnightly, monthly) align with super remittance processes. From 1 July 2026, those cycles will need to support super payments in every pay run, not quarterly.
Clean up employee data
Take this time to review and verify employee super fund details. Accurate fund information helps avoid rejected contributions and remittance delays.
Understand reporting changes
Under Payday Super, employers will report qualifying earnings and super liabilities through Single Touch Payroll (STP) in a revised format. Payroll teams should familiarise themselves with updated STP codes and requirements.
Plan for cashflow impacts
Paying super more frequently may influence cash flow. Payroll and finance teams should model the impact of these timing changes and plan accordingly.
Other considerations for payroll professionals
Small Business Super Clearing House (SBSCH) closure
The ATO’s free Small Business Superannuation Clearing House will close from 1 July 2026. Employers that currently use it will need to transition to other payment methods well before the deadline.
ATO compliance approach
The ATO has signalled it will take a practical compliance stance in the first year, focusing on employers who do not make a genuine effort to comply. However, late or missed payments can still attract super guarantee charges, interest and penalties.
