Compliance
Payday Super and loss carry back: What businesses need to do now
Super payment frequency and tax loss provisions are changing — business owners must update systems and strategies before these reforms take effect on 1 July 2026.
By NomadicTax Research Team • 5-8 min read • August 5, 2026
## What is changing for businesses from 1 July 2026
Australia is introducing **Payday Super**, meaning employers must pay superannuation contributions at each pay run and ensure those payments reach employee super funds within **7 business days**. ([business.gov.au](https://business.gov.au/news/changes-for-businesses-from-1-july-2026?utm_source=openai)) Also, the **Small Business Superannuation Clearing House (SBSCH)** is closing permanently, so employers using it need to transition to alternate providers. ([business.gov.au](https://business.gov.au/news/changes-for-businesses-from-1-july-2026?utm_source=openai))
Alongside these super reforms, the government is **reintroducing loss carry back** for eligible companies: businesses that incur losses can offset them against profits of the past two income years to obtain tax refunds, boosting cash flow. ([business.gov.au](https://business.gov.au/news/changes-for-businesses-from-1-july-2026?utm_source=openai))
## How to prepare your business infrastructure
- **Payroll systems**: Review and ensure your payroll software can handle superannuation contributions per pay period and support the reporting of “qualifying earnings.” ([community.ato.gov.au](https://community.ato.gov.au/s/article/a07Mo00001qD2iH/payday-super-starts-1-july-heres-what-employers-need-to-know?utm_source=openai))
- **Cash flow planning**: More frequent outflow from each payday requires tighter budgeting; also, loss carry back may improve cash flow if your business is seasonal or has volatile profits.
- **Accounting and tax accounting**: Maintain accurate records of losses and profits in prior years; consult with your adviser to compute eligibility and ensure your returns and lodgements are up to date.
- **Super fund administration**: Move away from the SBSCH and ensure you’re using a compliant method like SuperStream, and that you can meet fund timelines. ⸺ check whether your staff/enrolment and payment matching processes are ready.
## Practical examples
- **Example 1 – A retailer with unexpected loss in FY 2025-26**: Using loss carry back, the retailer can apply that loss to profits from FY 2023-24 and FY 2024-25 to claim a tax refund, improving its cash situation.
- **Example 2 – A small business still using SBSCH**: Must choose another super clearing house solution—download records now to avoid losing access and ensure payments are made each pay run starting 1 July 2026.
## Compliance risks & costs
Failure to comply with Payday Super may lead to:
- **late or unpaid super guarantee charges**,
- **penalties and interest** if contributions don’t reach funds within 7 days,
- potential audits or liability for inaccurate reporting in Single Touch Payroll (STP).
## Actionable checklist
- Confirm payroll cycles & payday definitions in your business.
- Update payroll software or engage a provider supporting per-payroll super.
- Assess prior years’ profit/loss records; prepare loss carry back claims where feasible.
- Schedule time with tax adviser to model impact on tax obligations, especially for cash flow.
## Summary
For businesses, 1 July 2026 marks a turning point. Since obligations and opportunities both shift dramatically—especially superannuation timing and loss offset rules—proactive planning and system updates now can reduce surprises, penalties, and lost benefits.