07 3124 0244 07 3124 0244

Payday Super - What You Need To Know

Posted 23 Feb

If you haven’t started thinking about Payday Super yet, now’s the time. This is one of the most significant changes to employer superannuation obligations in over 30 years and it officially starts on 1 July 2026 (tick tock tick tock, that date will be here before we know it!).

What is Payday Super?

Payday Super is a fundamental reform to how employers pay Super Guarantee (SG) contributions.

Under the current system, employers have historically paid super quarterly by the 28th day following the quarter ends. From 1 July 2026, that changes:

Employers must pay SG contributions at the same time as salary and wages, aligned to each pay cycle.

That means if you pay your employees weekly, fortnightly or monthly, their super must be paid in the same rhythm. Quarterly lump-sum payments will no longer meet compliance requirements.

Why the Change?

This reform is designed to:

  • Reduce unpaid or late super contributions by closing loopholes in quarterly reporting.
  • Improve retirement outcomes by getting money into employee accounts sooner, allowing for earlier investment and compounding.
  • Increase transparency and ATO oversight by linking SG payments directly to payroll data.

Key Obligations for Employers

Here’s what you need to know to comply:

1. Pay Super on Payday

From 1 July 2026, SG contributions must be paid at the same time you pay wages or salaries, no concessions, no exemptions.

The payroll date when wages are paid becomes the trigger date for your super obligations.

2. Meet the Payment Timeframe

Super must generally be received by the employee’s super fund within 7 business days of payday.

There are limited exceptions but if you follow this rule, you won’t be late.

3. Understand Qualifying Earnings (QE)

Under Payday Super, SG is calculated on the employee’s qualifying earnings, this calculation includes:

  • Ordinary time earnings (OTE)
  • Salary sacrifice amounts
  • Other pay components that count towards SG contributions

Payroll systems must be updated so SG calculations happen accurately each pay cycle.

4. Update Payroll Systems & Reporting

Your payroll and reporting systems need to support:

  • Per-payrun SG calculations
  • Single Touch Payroll (STP) reporting for SG amounts each cycle
  • Reconciliation with super fund receipts

If you currently use the ATO’s Small Business Superannuation Clearing House (SBSCH), note it will close for super payments on 30 June 2026, you’ll need to transition to a SuperStream-compliant method before then. Our blog here explains this in further detail

Cash Flow & Business Impact

Switching from quarterly to per-payroll super payments means more frequent cash outflows. Some business groups have raised concerns that this could strain cash flow, especially for small and medium enterprises.

Good cash flow planning will be essential; particularly if your pay cycle is weekly or fortnightly. If you are wondering how this may impact your business, reach out to your trusted Empire Advisor sooner rather than later.

What Happens If You Miss a Payment?

Failing to pay SG on time doesn’t just attract late fees; the Superannuation Guarantee Charge (SGC) rules can apply, and penalties may include:

  • The unpaid SG amount
  • Interest
  • Administrative charges
  • Loss of a tax deduction

Practical Steps to Get Ready Before July 2026

Here’s a simple preparation checklist for business owners:

  1. Review and upgrade payroll software — ensure it can calculate and report SG at each pay cycle.
  2. Map your payroll & cash flow — align super payments with wage outflows.
  3. Train payroll/HR teams on the new reporting requirements.
  4. Transition from the SBSCH if you currently use it.
  5. Update internal procedures for onboarding, fund details and STP reporting.

Conclusion

Payday Super represents a once in a generation change to employer super obligations in Australia. For many businesses, especially those still paying quarterly, it will require thoughtful planning and systems upgrades but it also brings more transparency and fairness to the super system.

If you’re unsure how Payday Super will affect your business, now is the ideal time to start implementing the changes well before 1 July 2026. The team at Empire Accountants and our friends at Empire Bookkeeping are here to support you through this.

Watch the Recording

Last month our very own Laura Stauder co-hosted a Webinar going into all the nitty gritty details on this very topic. Check out the link here to watch the recording.


Related News

The Real Cost of SMSF Setup and Annual Audits: Flat-Fee vs. Percentage Pricing

“So… how much does an SMSF actually cost me?” It’s hands-down the most common question we get from trustees, and the honest answer is: it depends on who you ask – and, crucially, on how they charge you. Let’s cut through the noise and put some real numbers on the table.

Can You Claim GST Credits Before Company Incorporation?

Starting a company is an exciting step, but the order in which you register your business and make purchases can affect your GST claims. If you have paid for equipment or start-up expenses personally before your company was incorporated, you may be wondering whether those GST credits are lost.

First Employee vs Contractor: When Should You Hire?

Starting a business can be equally exciting and daunting. What may have begun as a side hustle can grow into something much bigger - and eventually, you may reach the point where doing everything yourself is no longer sustainable.

For many small business owners, that next stage of growth brings an important question: should you hire your first employee or engage an independent contractor?