From 1 July 2026, a new rule will take effect, reshaping how Australian employers manage superannuation. Under the Payday Super reform, you’ll need to pay your employees’ super contributions at the same time as their wages, not quarterly as before.
This shift might sound like just another compliance update, but it’s much more than that. Payday Super marks a move toward real-time super payments, stronger transparency, and better retirement outcomes for Australian workers. Here’s everything you need to know - and how to prepare your business before the change takes effect.
Recommended Reads
- The Complete Guide to the Australian Payroll System
- Understand Single Touch Payroll (STP) and Your Obligations
Why the Government Is Introducing Payday Super
For years, employers have been allowed to pay super quarterly, up to 28 days after each quarter ends. While convenient, this often meant super contributions reached funds months late or, in some cases, not at all.
According to the Australian Taxation Office (ATO), more than $3.4 billion in super went unpaid in the 2019–20 financial year. That’s money employees missed out on for their future savings.
The government’s goal with Payday Super is to:
- Make sure super contributions reach funds faster
- Improve transparency and accountability for employers.
- Reduce the unpaid or delayed contributions.
- Align super payments with modern, digital payroll systems.
In short, Payday Super is about getting employees’ money where it belongs - sooner.
What’s Changing From 1 July 2026
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Super must be paid with wages
From July 2026, employers must pay superannuation guarantee (SG) contributions at the same time as wages or salaries.
The payments must usually arrive in each employee’s super fund within seven business days of payday. If your contribution doesn’t reach the fund in time, you’ll be liable for the Superannuation Guarantee Charge (SGC) - a penalty that includes unpaid amounts, interest, and administrative fees.
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A new concept: Qualifying Earnings (QE)
The legislation also introduces the idea of Qualifying Earnings (QE) - a new term for the amounts for which super is calculated. This includes:
- Ordinary time earnings (OTE)
- Salary sacrifice super contributions
- Other payments that currently make up salary or wages for SG purposes
Simply put, you’ll pay super based on QE for every pay cycle, rather than waiting until the end of a quarter.
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Extended timeframes in special cases
Most employers will need to meet the seven-day rule, but a few exceptions apply. You’ll have a little more time if, for example:
- You’re paying super for a new employee for the first time
- The payment falls outside your regular pay cycle
- You face exceptional circumstances, such as a major technical disruption.
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Updated SGC rules
If contributions are not paid on time, the SGC will still apply — but with updated components to match the new system:
- Individual shortfall: the unpaid or late amount
- Notional earnings: interest to cover lost investment income
- Administrative uplift: a fee that reflects the cost of enforcement
- Choice loading: applies if you don’t follow the employees’ choice of fund rules
The SGC will now be tax-deductible, which brings it in line with other business expenses.
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New reporting requirements
To make the system more transparent, you’ll need to report both Qualifying Earnings and super liabilities for each employee through Single Touch Payroll (STP). This ensures the ATO can see contributions in real time and track compliance automatically.
System Improvements to Support Payday Super
Alongside the new timing rules, several system updates will make super payments faster and more reliable:
- Better error messages: Super funds will now provide clearer feedback if a contribution fails, helping employers fix issues quickly.
- Faster fund allocations: Super funds will have only three business days (down from 20) to allocate or return contributions.
- Upgraded SuperStream standards: Payments will use the New Payments Platform (NPP) for near-instant transfers.
- Member Verification Requests: Employers can confirm employee details before paying, reducing rejected contributions.
These improvements will help create a smoother, real-time payment experience for both employers and employees.
Small Business Clearing House (SBSCH) Changes
The ATO has announced that the Small Business Superannuation Clearing House (SBSCH) will be phased out by 1 July 2026 and closed to new users from October 2025.
This is because most modern payroll software already offers built-in clearing features that make super payments faster and more accurate. The ATO has said it will guide small businesses through the transition to commercial alternatives well before the change takes effect.
The Transition Timeline
The ATO and Treasury have outlined a gradual rollout to give businesses time to adapt:
2024–25: Awareness and Consultation
- Government works with payroll providers and industry groups
- Businesses should review their current super and payroll processes
2025–26: Preparation Year
- Payroll software updates rolled out to support Payday Super
- Early adoption encouraged - many platforms like RomeoHR are already Payday Super-ready
- ATO releases checklists and practical guides
From 1 July 2026: Mandatory Compliance
- Payday Super becomes law for all employers
- Late or missed payments trigger the Super Guarantee Charge (SGC)
Common Employer Risks
Some employers may underestimate the shift to real-time super. Key risks include:
- Late payments: Missing the seven-day window could trigger costly penalties
- Cash flow strain: Businesses used to quarterly payments will need to budget more frequently
- Outdated software: Systems not compatible with real-time super will need upgrading
- Manual processing errors: Relying on spreadsheets or bank transfers can cause mismatches
- Audit triggers: Irregular or missing STP reports may attract ATO attention
How to Get Payday Super Ready
Here’s a practical checklist to prepare your business before the 2026 deadline:
Step 1: Review your current payroll process
Understand how often you pay super now and whether your process can handle more frequent payments.
Step 2: Upgrade to compliant software
Use STP Phase 2-compliant payroll software that supports Payday Super automation. Platforms like RomeoHR already have built-in functionality to align payments and reporting.
Step 3: Prepare your finance and HR teams
Make sure your bookkeeper and payroll officers understand the new timing and reporting requirements.
Step 4: Revisit your cash flow strategy
Since super will be paid with each pay run, adjust your budgets accordingly. Work with your accountant to plan for regular, smaller super outflows.
Step 5: Test your system in 2025
Do a “trial run” before 2026 to confirm your clearing house or payroll software can process real-time payments smoothly.
Step 6: Educate your staff
Inform employees about the change — it shows transparency and helps them understand the benefits of receiving super more promptly.
Conclusion
Payday Super is one of the biggest changes to payroll in recent years. While it introduces new timing and reporting rules, it ultimately benefits both employers and employees.
For employers, it means fewer end-of-quarter admin headaches and stronger compliance. For employees, it ensures their super contributions are paid promptly, improving their long-term financial security.
By planning early, updating your payroll systems, and understanding your obligations, you can make this transition a smooth one — and step confidently into the new era of real-time payroll compliance.
