Payday Super is Coming
From 1 July 2026, all employers must pay Superannuation Guarantee (“SG”) contributions at the same time as they pay employees’ “qualifying earnings” (“QE”). Payday Super replaces the current requirement to pay SG quarterly where employers have had 28 days from the end of each quarter to pay their SG contributions.
Under the new law, “payday” is defined as a QE day, and employers must ensure that SG contributions are received by employees’ superannuation funds within seven business days of each QE day, rather than within 28 days after the end of each quarter.
There are certain exceptions to the seven-day requirement for:
new employees;
where employer makes contribution to a stapled fund that is rejected;
out-of-cycle payments ; and
exceptional circumstances such as a natural disaster.
Your payroll software will need to process and submit super with every pay run. We suggest you check with your payroll provider that their system is Payday Super-ready, and to start testing the process before 1 July 2026, to allow sufficient time to upgrade systems, test them and undertake cash-flow planning.
The ATO’s Small Business Superannuation Clearing House will close on 1 July 2026 and affected employers must transition to an alternative SuperStream compliant solution by 30 June 2026. If you have not already made arrangements for an alternative, you should do so immediately to ensure that you have it in place by 30 June 2026, as SG contributions must not only be paid within seven business days of payday, but they must also be received by the employee’s nominated superannuation fund within seven days.
QE is a new concept under the amending legislation, and includes:
ordinary time earnings;
salary sacrifice superannuation contributions; and
such other defined amounts which are currently included in an employee’s salary or wages for SG.
The ATO has released PCG 2026/1, setting out a risk-based compliance approach for the first year of the new regime (1 July 2026 – 30 June 2027) which is briefly summarised as follows:
Low risk zone employers are those who attempt to pay SG on time and correct errors as soon as is reasonably practicable so that final SG shortfalls are nil.
Medium risk zone employers are those that do not meet the criteria to be in the low-risk zone, but all individual final SG shortfalls are nil by 28 days after the end of the relevant quarter in which the qualifying earnings were paid.
High risk zone applies if the employer has one or more individual final SG shortfalls greater than nil for their employees after 28 days following the end of the quarter in which the qualifying earnings were paid.
The penalty framework for SG shortfalls is changing. Late payments will attract a Superannuation Guarantee Charge that includes the shortfall amount, notional earnings calculated daily based on the General Interest Charge (“GIC”), and an administrative uplift of up to 60% of the SG shortfall. These penalties are assessed per payday, not per quarter.
If you are a company director, Payday Super raises the governance stakes. The Safe Harbour provisions under the Corporations Act which protect directors pursuing a restructuring plan require that employee entitlements are paid on time. Under the new rules, every missed payday super payment could disqualify you from Safe Harbour protection.
Employers should, in particular, be planning ahead to assess the merits of ensuring that their SG contributions for the final quarter of the 2025–26 financial year (April–June 2026) are paid before 30 June 2026. In contrast, if an employer pays the final 2025–26 financial year quarter before 28 July 2026, within the usual 28-day time frame that applies prior to 1 July 2026, this could easily result in excess contributions assessments for certain employees in the 2026–27 financial year. This might occur if the final June 2026 quarter and all of the 2026–27 financial year SG contributions are received in the 2026–27 financial year resulting in excess concessional contributions. Employers should therefore consider paying SG contributions for the 2025–26 financial year well before 30 June 2026 to minimise this risk.
Should you have any queries in relation to the above or would like to explore how we can support and guide you through these changes, please feel free to contact us on +61 3 9527 5041.