What is Payday Super?
From 1 July 2026, Australia’s “Payday Super” reforms will kick in. Under these changes, employers will no longer pay employee superannuation quarterly. Instead, contributions must be paid at the same time as salary or wages — i.e., on payday. The reforms also alter what payments qualify as earnings for super (called qualifying earnings) and tighten up when those contributions must reach super funds. (softwaredevelopers.ato.gov.au)
Key Changes Employers Must Know
- Qualifying Earnings (QE): This expands the definition to include ordinary time earnings, amounts sacrificed (e.g. salary sacrifice), and other payments. (ato.gov.au)
- Payment Timing: Contributions must be calculated as 12% of QE and paid on payday. The super fund must receive them within 7 business days, though exceptions (like new employees) may apply. (softwaredevelopers.ato.gov.au)
- Closing of SBSCH: The Small Business Superannuation Clearing House (SBSCH) will close permanently on 30 June 2026. Employers must plan to switch to an alternative payment method. (ato.gov.au)
- Reporting Requirements: Single Touch Payroll (STP) reporting will require new codes to report QE, year-to-date qualifying earnings, and super liability each pay cycle. (softwaredevelopers.ato.gov.au)
How It Impacts Employees and Small Business
Employees
- More frequent super payments — aligned with payday
- Better protection: Employers must pay on-time contributions; late payments may trigger compliance action and charges.
Small businesses
- Need to ensure payroll & software are ready to handle frequent payments and reporting
- Must switch from SBSCH to commercial clearing houses or compliant payroll software before 30 June 2026
- Adjust cash flow planning to accommodate more frequent super payouts
Example Scenario
Before 1 July 2026: A small café pays fortnightly wages but only makes super guarantee payments every quarter via SBSCH.
After reforms: -now must calculate super (12% of QE) each payday, -pay to the super fund within 7 business days after each payday, -download records from SBSCH before 30 June, -set up payroll or commercial clearing house for ongoing payments.
Action Steps for Compliance
- Audit current payroll software: does it support QE and new STP reporting codes?
- Select an alternative payment route before SBSCH closes — commercial clearing house or payroll system with super payment features.
- Train payroll staff on determining QE, tracking due dates, test run STP reporting for the new categories.
- Communicate the changes internally, particularly if you have employees with unusual arrangements (contractors, salary sacrifice etc.)
These reforms are more than an administrative headache — they're a chance to align super payments with modern payroll practice, prevent mis-payment errors, and protect employee entitlements. By preparing early, businesses can make the transition smooth — and employees can get what they’re owed, when they expect it.