What is Payday Super?
Payday Super refers to a major reform under the Superannuation Guarantee (SG) framework. From 1 July 2026, employers must calculate and pay their employees’ super guarantee on payday, not quarterly, based on qualifying earnings (QE), and deliver the payment to the super fund within 7 business days after payday. (softwaredevelopers.ato.gov.au)
This includes: ordinary time earnings, salary sacrifice amounts, and other payments that fall under the extended definition of employee—for example, certain independent contractors. (softwaredevelopers.ato.gov.au)
Key Changes and Timelines
| Change | What Changes | Effective Date |
|---|---|---|
| Payment timing | Instead of quarterly contributions, super must be paid at each payday and funds must receive the payments within 7 business days of payday. | From 1 July 2026 (softwaredevelopers.ato.gov.au) |
| Qualifying earnings | All earnings included in QE, not just ordinary earnings. Limits and eligibility clarified via LCR rulings. | From 1 July 2026 (softwaredevelopers.ato.gov.au) |
| SBSCH closure | The Small Business Superannuation Clearing House (SBSCH) closes. Employers must move to alternatives. | Closed permanently since 1 July 2026 (ato.gov.au) |
| Reporting in STP | From payday, employers must report both qualifying earnings and super liabilities in Single Touch Payroll (STP). | From 1 July 2026 (community.ato.gov.au) |
What Employers Need to Do Now
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Review payroll systems and software • Ensure payroll or DSP software supports the new QE code and super liability fields in STP.
• Confirm your software can process payments to super funds within 7 business days and handle fund validation. (softwaredevelopers.ato.gov.au) -
Switch from SBSCH if used • If you used the SBSCH, select an alternative method now—using commercial clearing houses or payroll-based super payment functions.
• Download your transaction history prior to its permanent closure. (ato.gov.au) -
Train your payroll, accounting, and HR teams • Establish internal processes around payday calculations, identifying qualifying earnings components, and monitoring funds’ receipt.
• Keep copies of pay-day-by-pay-day super payment schedules. -
Communicate with employees • Make sure staff understand any changes in how and when their super is paid.
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Monitor compliance and possible shortfalls • Be aware of penalties via the Super Guarantee Charge (SGC) if payments aren’t made on time or are misreported. Draft law companion rulings provide worked examples showing base and final shortfalls. (ato.gov.au)
Practical Example
Suppose Zara Work Co pays her employees fortnightly, with salaries including ordinary earnings and a commission that’s part of qualifying earnings. Payday is Friday 15 August 2026. Zara’s payroll must:
- Calculate 12% of all qualifying earnings paid on that day.
- Pay this amount to the relevant super fund so the fund receives it by 7 business days after payday—i.e. no later than Friday, 26 August 2026 (assuming no public holidays).
- Report both the qualifying earnings and super liability via STP in the same pay run.
Failure to comply could expose Zara to the SGC, including interest charges and penalties.
Why It Matters
- Cashflow implications, especially for small businesses: frequent super payments demand stronger cash flow management.
- Administrative changes, including software whole-system readiness and retraining staff.
- Lower risk for employees: more timely super payments should reduce instances of underpayment or delays.
Action Plan Checklist Before 1 July 2026
- Confirm payroll software update for Payday Super
- Choose and test alternative to SBSCH
- Update internal policies for QE calculation
- Communicate changes with team and employees
- Review ACH and payment platforms for timely payment capability
- Monitor first few paydays closely and review SGC exposure
Employers who prepare early will find the transition smoother and protect themselves from the compliance risks of getting Payday Super wrong.