Compliance
Payday Super Reform: What Employers Must Do from 1 July 2026
Australia’s new Payday Super reforms require employers to switch from quarterly super payments to paying each payday – this article tells you how to comply and avoid costly penalties.
By NomadicTax Research Team • 5-8 min read • July 21, 2026
## 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](https://community.ato.gov.au/s/article/a07Mo00001qD2iH/payday-super-starts-1-july-heres-what-employers-need-to-know?utm_source=openai))
## Key obligations for employers
- **Payment frequency**: Super contributions must reach super funds within **7 business days** after each payday. ([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))
- **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](https://community.ato.gov.au/s/article/a07Mo00001qD2iH/payday-super-starts-1-july-heres-what-employers-need-to-know?utm_source=openai))
- **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](https://community.ato.gov.au/s/article/a07Mo00001qD2iH/payday-super-starts-1-july-heres-what-employers-need-to-know?utm_source=openai))
- **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](https://community.ato.gov.au/s/article/a07Mo00001qD2iH/payday-super-starts-1-july-heres-what-employers-need-to-know?utm_source=openai))
## 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
1. Audit your current pay and super payment processes. Identify pay cycles, super fund timing, and whether payments currently through SBSCH.
2. Upgrade or update payroll/system provider to comply with STP reporting changes.
3. Inform employees about the change – what pay is considered under QE, how often super is now paid.
4. 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.