Introducing Payday Super

What is Payday Super?

Payday Super was announced during the 2023/2024 Federal Budget. The purpose is to increase the retirement incomes and savings for Australian by ensuring frequent payment of superannuation. It addresses the non-payment and underpayment of super thus strengthening Australia’s superannuation system.

What do you need to know?

From 1 July 2026, Superannuation Guarantee (SG) contributions will be required to be paid on “payday”. This aligns with the date the employer pays Ordinary Time Earnings (OTE).

Employers will be held to a new 7 day “due date” for the contributions to arrive in their employees’ superannuation funds.

If the SG contributions are not received in an employee’s superannuation fund with 7 calendar days of payday, the employer will face increased SG charges.

There are circumstances where an employer can be exempted from the 7-day deadline:

• New employees – If payday falls within the first two weeks of new employment. In this case, the 7-day due date is deferred to after this two-week period.

• Small and irregular payments – Where SG contributions are paid for irregular payments outside the employee’s ordinary pay cycle. In this case, the payment will not constitute a payday and will be considered on the next regular payday.

  
  

Employers will be liable for increased SG charges and penalties if they fail to pay SG contributions on time.

Transitioning to Payday Super

The are several measures being implemented to facilitate the transition to Payday Super:

• Fund allocation: The deadline for super funds to allocate or return contributions will be 3 days, down from 20 days.

• SuperStream updates: The SuperStream data and payment standards will be revised to allow faster payments via the New Payments Platform and improve error messaging between employers and intermediaries.

• Single Touch Payroll (STP) updates: Employers will be required to report in STP both the OTE and the super liability for an employee, which ensures the SG can be correctly identified.

• Revised choice of fund rules – to make it easier for employees to nominate their superannuation fund.

• Advertising restrictions – this will apply to superannuation products and will be limited to MySuper products that have passed the recent performance tests.

• The ATO Small Business Superannuation Clearing House will be retired from 1 July 2026.

If you handle your employees' super payments using the Small Business Superannuation Clearing House (SBSCH), just a heads up that it’s shutting down on July 1, 2026.

The ATO has stated that they will engage with small businesses ahead of time to support them in transitioning to an alternative form of paying the SG that is fit-for-purpose for Payday Super.

Payday Super is one of the Australian Government’s biggest changes since the introduction of the Superannuation Guarantee (Administration) Act 1992 (SGAA 1992). It is important that employers understand the implications for their business and most importantly for their employees.

For more information, please refer to the ATO’s Payday Superannuation page:

https://www.ato.gov.au/about-ato/new-legislation/in-detail/superannuation/payday-superannuation

If you have any questions on Payday Super and how it may impact you or your business, please contact Steve Marsten on (07) 3876-6211