What is Payday Super?
Payday Super is a major reform to how employers calculate and pay super guarantee (SG) contributions. Beginning 1 July 2026, employers must:
- pay SG at the same time as salary and wages (on each payday);
- calculate SG on an employee’s qualifying earnings (which includes ordinary time earnings, commissions, salary sacrifice, and certain contractor‐like payments);
- ensure contributions are received by the super fund within 7 business days after payday (unless an extended timeframe applies, such as for new employees).(softwaredevelopers.ato.gov.au)
Why it Matters for Employers
- Cashflow planning becomes more frequent and precise—small businesses used to quarterly payments will now manage SG with each payroll run.
- Compliance risk is higher—late payments will incur the Super Guarantee Charge (SGC) with fewer grace periods. Draft rulings like LCR 2026/D3 clarify how the SG charge will be assessed under Payday Super.(ato.gov.au)
- Reporting changes—employers must report qualifying earnings using a new STP (Single Touch Payroll) code (“QE”) starting 1 July 2026. Payroll software will need updating.(softwaredevelopers.ato.gov.au)
Key Transition Details
| Item | Description |
|---|---|
| SBSCH Closure | The Small Business Superannuation Clearing House closed permanently on 1 July 2026; employers must use alternative payment methods.(community.ato.gov.au) |
| Final Quarterly Payments | Employers still calculate super for 1 April–30 June 2026 and ensure payment by 28 July 2026. If missed, SGC is due by 28 August 2026.(community.ato.gov.au) |
| Two‐Year Transitional Period | From 1 July 2026 to 30 June 2028, some rules like the test period for calculating SG charge shortfalls are modified under transitional provisions.(ato.gov.au) |
Actions Employers Should Take Now
- Audit payroll systems to ensure they can calculate qualifying earnings accurately and pay every payday.
- Upgrade your software to support the new STP code for qualifying earnings (“QE”) and meet SuperStream / payment data standards.
- Switch payment method from the SBSCH before it closes. Identify and test alternatives.
- Analyze cashflow effects, especially smaller businesses adjusting from quarterly to per-payday super flows.
Example Scenario
Acme Landscapes, a small business with fortnightly payroll: previously paid SG monthly or quarterly. Under Payday Super from 14 payments a year, they must now pay SG every two weeks. Their payroll software must validate each payment to avoid late payments. By mid-2026, they upgrade software and plan weekly budgets to ensure funds reach super funds within 7 days.
What Happens If Employers Miss the Date?
- Failure to make contributions in time may trigger the Super Guarantee Charge (SGC).
- ATO draft rulings (e.g. LCR 2026/D3) outline how shortfalls are calculated and assessed. Best practice: take voluntary disclosure if needed.(ato.gov.au)
Bottom line: Payday Super represents the biggest shift in SG payment timing in decades. Get systems ready, cashflows aligned, and ensure you meet each payday’s obligations.