Published: January 2026
From 1 July 2026, the way Australian employers pay superannuation is changing fundamentally. Instead of paying super quarterly, you will need to pay it at the same time as wages, with contributions reaching employee super funds within seven days.
This is the biggest change to superannuation compliance in decades. It affects every Australian business with employees.
The legislation passed in November 2025 after years of discussion. The rules are now set. The question is whether your business is ready.
Current rules (until 30 June 2026). Superannuation guarantee (SG) contributions are due quarterly, by the 28th day after the end of each quarter. For example, contributions for the January-March quarter are due by 28 April.
This gives employers flexibility. You can collect payroll throughout the quarter and pay super in one batch near the deadline.
New rules (from 1 July 2026). SG contributions must be paid on payday. Contributions must be received by the employee's super fund within seven business days of paying wages.
If you pay wages on Monday 1 July 2026, the super fund must receive the SG contribution by Wednesday 10 July 2026 (allowing for weekends).
The change applies to all SG contributions, including salary sacrifice amounts.
The government estimates that $3.4 to $5.2 billion in superannuation goes unpaid each year. Employees, particularly lower-paid, casual, and insecure workers, miss out on their entitlements.
Quarterly payments allow problems to accumulate. An employer in financial difficulty can defer super for months before issues become apparent. Employees may only discover missing contributions when they check their super statement long after the fact.
Payday super makes non-compliance visible immediately. If super does not arrive, employees know within days rather than months.
The government also argues that more frequent contributions improve retirement outcomes through better compounding. Treasury estimates a 25-year-old median income earner could be around 1.5% (approximately $6,000) better off at retirement from the shift to payday contributions.
For most employers, this is the main practical concern.
Under quarterly rules, you effectively hold super contributions for up to three months before paying. This provides a cash flow benefit, particularly for businesses with tight margins.
Under payday rules, cash flows out immediately. Every pay run includes both wages and super leaving your account in the same period.
For a business with weekly payroll, this means 52 super payments per year instead of 4. The total amount is the same, but the timing changes dramatically.
Example: A business with $100,000 monthly payroll and 12% SG owes $12,000 in super per month. Under quarterly rules, that $36,000 sits in the business account for up to three months before payment. Under payday rules, $12,000 leaves each month concurrent with wages.
This represents a one-time working capital impact when the transition occurs, plus ongoing loss of the float previously available.
Your payroll system needs to handle same-day super processing. Key questions:
1. Can your software process super with each pay run? Most modern payroll systems can. Older systems may need updates or replacement.
2. Does your clearing house support payday super? Super contributions typically go through a clearing house that distributes to multiple funds. The Small Business Superannuation Clearing House (SBSCH) will close from 1 July 2026. New users have been unable to register since 1 October 2025.
3. What is the processing time? The seven-day deadline means contributions must be received by the fund, not just initiated. Processing time matters. If your clearing house or super fund takes three to four days to process, you only have three to four days after payday to initiate.
4. Can you track compliance? You need visibility into whether contributions reached funds on time. STP Phase 2 reporting provides some of this, but you need clear internal tracking.
Single Touch Payroll (STP) already requires reporting of payroll information each pay event. Payday super builds on this infrastructure.
The ATO will use STP data to monitor compliance automatically. Late or missing contributions will be detected quickly, potentially triggering compliance action.
Ensure your STP reporting is accurate and timely. Errors or delays in reporting create additional risk under the new regime.
The ATO released Draft Practical Compliance Guideline PCG 2025/D5 outlining their approach for the first year (1 July 2026 to 30 June 2027).
Employers will be placed in risk zones:
- Low risk. Employers who make timely contributions and fix mistakes quickly. The ATO will not apply compliance resources to these employers.
- Medium risk. Some compliance issues but attempting good faith efforts. The ATO may apply resources but lower priority than high-risk.
- High risk. Persistent or deliberate non-compliance. Full compliance attention.
This indicates the ATO recognises implementation challenges and will show some flexibility for genuine good-faith efforts in year one. However, it does not remove legal obligations. If the ATO becomes aware of a superannuation shortfall, it remains legally required to apply the legislation.
The message: try hard, fix mistakes quickly, and document your efforts.
Under the new framework, late or missing contributions trigger:
- Superannuation Guarantee Charge (SGC). The SGC includes the unpaid super amount, interest, and an administration component. Unlike the current system, SGC under payday super will be tax-deductible (excluding penalties and interest).
- Late payment penalties. Additional penalties apply for repeated or serious non-compliance.
- Interest on shortfalls. Calculated from the due date until payment.
The SGC applies per pay event. With weekly payroll, that potentially means 52 opportunities for penalties per year rather than 4.
Start now. The transition is six months away as of January 2026.
1. Audit your current payroll system. Can it process super each pay run? Does it integrate with your clearing house? What updates are needed?
2. Talk to your payroll provider. Software companies and bureaus are preparing for payday super. Understand their timeline and what you need to do.
3. Find a compliant clearing house. If you use the SBSCH, you need an alternative before July 2026. Research options and set up a new arrangement.
4. Review cash flow forecasting. Model the impact of paying super on payday rather than quarterly. Adjust your forecasts and working capital expectations.
5. Update payment processes. Ensure you can initiate super payments immediately after each pay run, not as a separate batch process days later.
6. Train relevant staff. Payroll staff need to understand the new requirements and timing.
7. Consider voluntary early adoption. Some businesses are starting payday super payments now to test systems and processes before the deadline.
8. Document your compliance efforts. If issues arise, evidence of good faith efforts supports a better position with the ATO.
Before 1 July 2026:
- Weekly payroll. The highest frequency means the most payments and the greatest cash flow shift. Plan carefully.
- Multiple pay cycles. If you have different pay frequencies for different employees, each cycle needs its own super processing.
- Casual employees. Every payment to casual employees triggers super obligations. There is no minimum threshold.
- Contractors. If contractors are treated as employees for SG purposes (principally for labour), payday super applies to them too.
- New employees. There is an exception where the due date falls after the first two weeks of employment, providing brief setup time.
1 July 2026. The legislation passed in November 2025 and is now law.
Super contributions must be received by the employee's super fund within seven business days of payday.
The SBSCH closes from 1 July 2026. New users have been unable to register since 1 October 2025. Existing users need to find an alternative clearing house before the deadline.
The ATO's practical compliance guideline indicates a risk-based approach for 2026-27, with lower priority for employers making good-faith efforts and correcting mistakes quickly. However, legal obligations still apply.
You lose the cash flow benefit of holding super for up to three months. Super payments align with each pay run rather than quarterly batches. Model the impact for your specific payroll timing and amount.
You are responsible for the contribution being received on time, not just initiated. Build in buffer time for processing. If late, correct quickly and document your efforts.
Possibly. Check whether your current system can process super each pay run and integrate with a compliant clearing house. Many systems are releasing updates for payday super.
The Superannuation Guarantee Charge includes the unpaid amount, interest, and administration charges. Additional penalties apply for serious or repeated non-compliance.
Scale Suite helps Australian businesses prepare for payday super and other payroll compliance changes. Our services include:
If you are uncertain whether your business is ready for payday super, we can help you assess your situation and create a preparation plan.
Contact us at hello@scalesuite.com.au or visit scalesuite.com.au.
This article provides general information about payday super requirements. Individual circumstances vary, and you should confirm specific obligations with the ATO or qualified advisors. Information is current as of January 2026; check official sources for updates.
Scale Suite delivers embedded finance and human resource services for ambitious Australian businesses.Our Sydney-based team integrates with your daily operations through a shared platform, working like part of your internal staff but with senior-level expertise. From complete bookkeeping to strategic CFO insights, we deliver better outcomes than a single hire - without the recruitment risk, training time, or full-time salary commitment.
Considering hiring finance staff?
We’ll show you the full cost of an internal hire vs our embedded team – and exactly how much you’d save.
We’ll reply within 24 hours to book your free 30-minute call. No lock-in contracts and 30-day money-back guarantee
