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From 1 July 2026, the new Payday super rules for employers requires paying employees’ Super Guarantee (SG) in line with each payday (your normal pay cycle), replacing the current quarterly obligation.

Key changes include:

• SG remains 12%, but the earnings base shifts from the current Ordinary Time Earnings to Qualifying earnings (QE). The two are very similar and for standard wages subject to super likely no impact however review closely if you have payments and allowances that are not currently subject to super.
• Super will be due within 7 business days of payday and must be received and allocable by the employee’s fund to be “on time”.
• New employees generally have an extended timeframe for the first payment (commonly 20 business days after the first pay).
• Single Touch Payroll reporting expands to include QE and super liability. We expect that payroll solutions will manage this change.

The ATO have a useful fact sheet of key changes.

Guide to managing Payday super in practice

The goal is simple: make super a routine payroll step so it is received by funds within the required timeframe.

Recommended approaches:

• Use an integrated payroll super payment feature (for example, “auto super” within software such as Xero or MYOB) so super is processed alongside each pay run.
• If you are not using a payroll payment solution, the ATO Small Business Superannuation Clearing House (SBSCH) is closing and will need to be replaced with another clearing house.
• There are many commercial clearing house options available. We hear good reports about QuickSuper (owned by Westpac).

Practical controls that reduce payment failures:

• Keep employee fund details current (including changes of fund) to reduce rejected payments and delays. Communicate with your team.
• Build a simple checklist after each pay run: wages paid, payroll filed, SG calculated, super payment submitted, confirmation received.
• Consider including a default super fund in employment contracts to reduce the risk of late super where a new employee does not nominate or provide fund details (seek legal advice for contract drafting and review any applicable award requirements).

Timeframes to be ready and why we recommend starting ASAP

Important dates:

• 1 October 2025: SBSCH closed to new users.
• 30 June 2026: last day existing SBSCH users can access the service.
• 1 July 2026: Payday Super rules commence.

Why start now:

• Test and stabilise your process before it becomes mandatory.
• Earlier change reduces the risk of missed deadlines, rejected contributions, and additional administration during the transition period.
• Flexibility to manage your cashflow transition over time.

Cashflow planning – avoid the “double hit” in July 2026

The move to Payday Super may create a short-term cashflow squeeze in July 2026.

Under the current system, super for the April–June quarter is due by 28 July. Under Payday Super, you’ll also start paying super with each pay run from 1 July 2026.

Transition options include moving to payday super earlier (for example, start paying super each pay run from April or May 2026 while still meeting quarterly obligations), or building a dedicated “super set-aside” cash buffer each pay period leading into July 2026.

Late fees and penalties

If super is not received by the fund within the required timeframe, the Superannuation Guarantee Charge (SGC) can apply and is more costly and time consuming than paying super on time.

In general terms, the redesigned SGC can include a shortfall amount, an interest component and an administrative component (potentially a 60% uplift!) and potential penalties (25 to 50%) where obligations are not met.

The best approach is to pay super on time, every pay run. This avoids the administrative burden and extortionate cost of late compliance.

The ATO has released Practical Compliance Guideline PCG 2026/1 Payday Super – first year ATO compliance approach. This indicates some flexibility to ATO compliance early on however we recommend doing it right upfront rather than relying on potential ATO leniency.

Summary of tips

• Get started early.
• Treat “on time” as received by the fund within 7 business days, not when the payment leaves your bank. Note that the auto super providers and clearing houses can be slow, so to meet the deadline aim to process on the same day as payroll not on day 7.
• Review pay categories and payroll mapping so QE is calculated correctly. This is particularly relevant if you have pay items that fall outside of Ordinary Time Earnings to confirm they are remain outside of QE definition.
• If you use SBSCH, choose a replacement clearing house and switch well before 30 June 2026.
• Make fund details an onboarding and regular payroll maintenance item to reduce bounce-backs.

Our team are here to help with Q&A, troubleshooting, payroll software implementation and cashflow planning.