What is Payday Super?
“Payday Super” is a reform changing how and when super guarantee (SG) contributions are calculated and paid. From 1 July 2026, employers must pay SG on each payday, rather than quarterly. Under the new rules:
- SG is calculated at 12% of qualifying earnings (a broader base that includes certain contractor payments as well as ordinary time earnings). (softwaredevelopers.ato.gov.au)
- Contributions must be received by super funds within 7 business days after payday (subject to some extended timeframes for specific situations). (ato.gov.au)
- The Small Business Superannuation Clearing House (SBSCH) will close from 1 July 2026. Employers must transition to alternative payment methods. (ato.gov.au)
Compliance Checklist for Employers
| Area | What needs to change | Deadline / Key Considerations |
|---|---|---|
| Payroll system updates | Ensure ability to calculate qualifying earnings for all employees (including contractors primarily engaged for labour) and pay SG every payday. | Before first payday after 1 July 2026. System testing and staff training required. |
| Reporting via STP | Add new STP labels to include year-to-date qualifying earnings and SG liability. | STP product providers to update before 1 July 2026; employers verify label mapping and data flows. |
| Payment timing | Contributions must reach super funds within 7 business days post-payday; leave buffer time for validation and errors. | Employers should plan payroll cycles and cashflows accordingly. |
| Transition from SBSCH | Download historic records, choose a new payment process, ensure funds and identifiers are correct. | Effective from 1 July 2026; final SBSCH payment due 28 July 2026 for the June quarter. (community.ato.gov.au) |
| Penalties and SG charge risk | Understand risk of shortfalls; new draft rulings (LCR 2026 series) set out how administrative uplifts will apply; voluntary disclosure reduces penalties. | Understand by mid-2026; review exposures and possibly adjust practices. |
Real World Example
- ABC Café currently pays super quarterly. They have employees paid weekly. After 1 July 2026 each weekly pay requires SG calculated on qualifying earnings and paid within 7 business days. Their payroll software must support tracking these earnings, possibly including contractor payments.
- XYZ Digital uses SBSCH but must transition away. They need to ensure correct fund information (USIs), and validate super fund details with employees to avoid misallocation.
Actionable Advice
- Audit all payments classified as wages or similar (contractor vs employee) to ensure you meet qualifying earnings definition.
- Update payroll software and test for edge cases: split pay-days, backpay, bonuses.
- Engage with DSPs (digital service providers) early to ensure STP updates and fund validation service functionality are correct.
- Inform employees of changes, especially in payment timing and how super contributions will work.
Key takeaway: Payday Super represents one of the biggest changes to employer super obligations in years. With the right systems, clear definitions and good cashflow management, compliance is achievable — missteps may lead to SG charges or penalties.