What is Payday Super?
Payday Super is a reform commencing 1 July 2026 that changes how employers pay superannuation guarantee (SG) contributions. Instead of quarterly payments, employers must pay super every payday, based on qualifying earnings. (community.ato.gov.au)
Key obligations for employers
- Payment frequency: Super contributions must reach super funds within 7 business days after each payday. (community.ato.gov.au)
- Qualifying earnings (QE): New term replacing or encompassing ordinary time earnings (OTE); includes payments to contractors engaged primarily for their labour, OTE, etc. Employers must correctly classify qualifying earnings. (community.ato.gov.au)
- Small Business Superannuation Clearing House (SBSCH) will permanently close on 30 June 2026. Employers using it must switch payments and download records before the deadline. (community.ato.gov.au)
- Reporting and systems update: Payroll systems must be ready to report extra info through Single Touch Payroll, including year-to-date qualifying earnings and super liability. (community.ato.gov.au)
Common challenges and how to meet them
- Cash flow management: Paying super every payday will require tighter planning – map out pay cycles and align with cash availability.
- Payroll system readiness: Ensure qualifying earnings are calculated correctly, pay codes mapped properly, and STP software updated.
- Record-keeping: Be prepared for extra reporting requirements. Keep documentation supporting qualifying earnings, super pay-dates, fund details, etc.
- Training and communication: HR, payroll, and financial teams should understand the reform to avoid misclassification or missed payments.
Example scenario
Your business pays fortnightly; your employee receives salary ($2,000) plus allowances and bonuses that are “qualifying earnings”. Under Payday Super, you must calculate total QE for that payday, pay the super contribution within 7 business days, and report via STP the QE and SG liability. If you previously used the SBSCH, you need to have switched methods before 1 July.
Consequences of non-compliance
- Late super payments may trigger SG Charge. The payroll shortfall penalties or interest may apply.
- Failure to report proper QE or to pay on time can lead to audits or notices from the ATO.
What employers should do now
- Audit your current pay and super payment processes. Identify pay cycles, super fund timing, and whether payments currently through SBSCH.
- Upgrade or update payroll/system provider to comply with STP reporting changes.
- Inform employees about the change – what pay is considered under QE, how often super is now paid.
- Budget and cashflow forecast: moving from quarterly to more frequent payments increases regular obligations.
Summary
- Payday Super starts on 1 July 2026, moving from quarterly to payday super contributions.
- Enterprises need to pay super within 7 business days post-payday based on qualifying earnings.
- SBSCH closes on 30 June 2026 – transition early to avoid disruption.
- Keep payroll software updated, classifications clear, and ensure reporting through STP aligns with new rules.
Getting these changes right early means fewer headaches and penalties down the road.