Key Takeaways
From 1 July 2026, most employers must pay Superannuation Guarantee (SG) at or near every payday under the new “Payday Super” framework, replacing quarterly deadlines.
The SG rate is 12% of employee’s ordinary time earnings from 1 July 2025 and remains at 12% for the 2026–27 income year, although some enterprise agreements may require a higher SG rate.
Late contributions, late payment, and unpaid super payments will more easily attract the Superannuation Guarantee Charge (SGC) and interest charges if not paid within 7 business days of payday.
1 July 2026 employers need to update payroll systems and cash-flow planning before this date to avoid penalties and comply with super laws.
Contribution caps and some tax thresholds are indexed for 2026–27—check the latest figures on the ATO website.
Overview of Superannuation Changes in 2026 as per Australian Taxation Office (ATO)
From 1 July 2026, the Australian Government introduces Payday Super, requiring employers to pay super contributions at or near each wage payment day, rather than quarterly.
Contributions must reach employees’ complying super fund—a fund that meets government standards—or retirement savings account within 7 business days of payday. This change ensures more timely super payments and helps employees benefit from earlier access to their retirement savings.
The super guarantee SG rate remains at 12% of ordinary time earnings, and contribution caps are adjusted annually. The Australian Taxation Office (ATO) will increase enforcement to ensure compliance with these new super obligations.
This guide provides practical information for superannuation changes 2026 Australia, Australian employers, payroll managers, and advisors about payment timing, contribution rates, employer obligations, system changes, and compliance risks to help protect members’ retirement savings.
If you have questions or need support, please Contact Us Smart Digits for expert guidance on navigating these changes and meeting your super obligations effectively. Many employers find that integrating AI accountant software can streamline payroll and superannuation processes, ensuring timely and accurate super contributions.
Payday Super from 1 July 2026
What Is Payday Super?
Payday Super aligns super contributions with wage payments, requiring employers to pay super at or near each payday. This change helps employees benefit from earlier compounding returns on their retirement savings and reduces the risk of outstanding payments, late payment, or late contributions.
For example, if you pay wages on 15 January in a fortnightly pay cycle, the super contributions must reach the employee’s super fund by 24 January (within 7 business days). Similarly, for a monthly pay cycle with wages paid on 30 January, super contributions must be received by the fund by 8 February. This ensures timely payments and compliance with the new Payday Super rules.
By paying super more frequently, employees have quicker access to their retirement savings growth, and employers reduce the risk of accumulating unpaid super liabilities. This change also enhances transparency and timeliness in super payments, improving overall superannuation system integrity.
Current Rules vs. 2026 Changes: How will it Impact your Business Operations?
Currently, employers pay super at least quarterly, with due dates 28 days after each quarter ends. From 1 July 2026, super must be paid within 7 business days of each payday. For new employees without fund details, the first contribution must be paid within 20 business days of the first wage payment.
This shift means employers will need to adapt their payroll and accounting processes to handle more frequent super payments. Proper planning and system updates are essential to avoid late contributions, late payment, and penalties.
As part of your Australian Business Year-End Checklist, ensure your payroll systems are updated and compliant with Payday Super requirements before 1 July 2026.
Who Does Payday Super Apply To?
Payday Super applies to SG contributions for eligible employees and contractors treated as employees for SG purposes, regardless of business size. Some enterprise agreements or awards may require a higher SG rate or stricter timing.
Employers of all sizes must comply, including small businesses and sole traders with employees. The Australian Taxation Office (ATO) will monitor compliance closely and provide guidance during the transition period.
Who You Must Pay Super To in 2026
Eligibility
Employers must pay super for most employees, including:
Full-time, part-time, and casual employees who work more than 30 hours a week if under 18
Company directors receiving fees or salary
Many contractors paid mainly for their labour
The same eligibility rules apply from 1 July 2026, with the main change being payment timing.
Age and Hours Thresholds
SG applies to employees aged 18 and over, and under-18s working more than 30 hours per week.
Employers should review their workforce regularly to ensure they identify all eligible employees, including those who may have recently changed employment status or hours worked.
High-Income Earners and Contribution Caps
Employers do not need to pay SG on earnings above the maximum super contribution base per quarter (e.g., $62,500 for 2025–26). Multiple employers apply the cap independently.
This cap is indexed annually based on Average Weekly Ordinary Time Earnings (AWOTE). Employers should check the latest maximum super contribution base on the ATO website each year to ensure compliance.
How Much Super to Pay in 2026
The 12% SG Rate
The super guarantee SG rate is 12% of employee’s ordinary time earnings from 1 July 2025 through 2026–27. Some enterprise agreements may require a higher SG rate.
Employers should confirm any applicable enterprise agreements or awards that might affect the SG rate for their employees.
Calculating SG on Ordinary Time Earnings
Ordinary time earnings include wages for ordinary hours, commissions, shift loadings, some allowances, and paid leave. Overtime and some payments are excluded.
Understanding what counts as ordinary time earnings is critical to calculating the correct SG amount. Employers should refer to the ATO and Fair Work guidelines for detailed definitions.
Example Calculation
An employee earning $2,000 in ordinary time earnings per fortnight requires $240 in SG (12% × $2,000), payable within 7 business days of payday under Payday Super.
For a weekly pay cycle, an employee earning $1,000 in ordinary time earnings per week would require $120 in SG (12% × $1,000), payable within 7 business days of each weekly payday. For example, if payday is Friday 5 March, the super contributions must be received by the employee’s super fund by Friday 12 March.
For a monthly pay cycle, an employee earning $4,000 in ordinary time earnings per month would require $480 in SG (12% × $4,000), payable within 7 business days of the monthly payday. For instance, if payday is 30 April, the super contributions must reach the fund by 7 May under Payday Super rules.
Salary Sacrifice and Personal Contributions
Voluntary personal contributions and salary sacrifice amounts are separate from compulsory SG and do not reduce the minimum amount employers need to pay.
Employers should ensure these contributions are processed correctly and separately to avoid compliance issues.
Payment Due Dates and Transitional Rules
Quarterly Deadlines End in 2025–26
The 2025–26 year is the last with quarterly due dates. From 1 July 2026, Payday Super timing applies and most employees’ super contributions must be paid at or near each payday.
Employers should prepare for this transition by reviewing their payment schedules and systems well in advance.
Payday-Based Deadlines from 1 July 2026
Super must reach employees’ complying super fund or retirement savings account within 7 business days of payday. Employers should initiate payments early to avoid processing delays causing late contributions, late payment, and potential super guarantee charge penalties.
Employers are encouraged to set internal deadlines earlier than the 7-day window to account for payment processing times.
Handling Pay Periods Crossing 30 June 2026
For pay periods spanning June and July 2026, Payday Super rules apply from 1 July 2026 payday onwards.
Employers should carefully assess payroll periods that cross the financial year-end to ensure correct application of payment rules.
Weekends and Public Holidays
If due dates fall on weekends or holidays, payments must be made in time for next business day receipt.
Employers should factor in banking and processing times when scheduling super payments.
Super Funds, Stapling, and Employee Choice
Offering Fund Choice
Employers must provide eligible employees with a choice of super fund on commencement and accept at least one change request every 12 months.
Clear communication about fund options helps employees make informed decisions and supports compliance.
Stapled Super Funds
If employees do not choose a super fund, employers must pay their super contributions into the employee’s stapled super fund. A stapled super fund is an existing super account that stays with the employee when they change jobs, helping to avoid creating multiple accounts.
If the employee does not have a stapled fund, the employer must pay the contributions into their default MySuper fund. In some cases, if the employee has nominated a self-managed super fund (SMSF), the employer will pay contributions there instead. This process ensures that super payments are made smoothly and correctly, even if the employee hasn’t actively selected a fund.
Employers can obtain details about Self-Managed Super Funds Melbourne from the ATO to ensure correct payments.
Tax File Number Obligations
Employers must provide employees’ Tax File Numbers (TFNs) to their super fund within 14 days of receipt to avoid higher tax rates on contributions.
Failure to provide TFNs can result in unnecessary tax penalties for employees and compliance issues for employers.
Verifying Fund Details
Before Payday Super starts, verify employees’ fund details (USI, ABN, bank info) to prevent payment errors, outstanding payments, and penalties.
Regular fund detail verification reduces the risk of rejected payments and administrative delays.
Making Super Payments and Payroll Systems
System Requirements
From 1 July 2026, payroll systems must:
Calculate SG at 12% for each pay cycle
Send contributions electronically in SuperStream-compliant standard format
Handle more frequent payment runs aligned with pay day
Generate accurate remittance files
Employers should liaise with payroll software providers to ensure systems are updated and tested for Payday Super compliance. Leveraging AI accountant software can help automate these tasks, reducing errors and ensuring timely super payments.
What Is SuperStream?
SuperStream is the mandatory electronic standard for super data and payments, ensuring efficient processing to complying super funds and retirement savings accounts.
Using SuperStream compliant systems reduces errors and speeds up payment processing.
Using Clearing Houses
Clearing houses allow one payment to cover multiple funds, useful with increased payment frequency and multiple funds per employee.
Employers can use government or commercial clearing houses to simplify super payments and reduce administrative burden.
Readiness Checklist
Employers should:
Review pay cycles and map SG timing
Update payroll software
Test payment runs
Confirm bank limits and processing times
Train staff on new requirements
Early preparation helps avoid last-minute issues and ensures smooth transition to Payday Super.
Reporting, Record-Keeping, and Compliance
Single Touch Payroll Reporting
STP Phase 2 remains the main method to report wages and super to the Australian Taxation Office (ATO), enabling quicker detection of unpaid or late super.
Employers must ensure payroll systems support STP reporting to meet regulatory requirements.
Record-Keeping
Employers must keep records of SG calculations, payment dates, fund details, and employee fund choices for at least 5 years to comply with super laws.
Accurate records support audits and help resolve disputes efficiently.
Enhanced Data-Matching and Enforcement
The ATO will use data matching to identify unpaid or late super, supported by increased funding for compliance programs.
Employers should proactively manage super obligations to avoid penalties and reputational damage.
Consequences of Non-Compliance
Penalties include:
Superannuation Guarantee Charge (SGC) with shortfall, interest, and fees
Additional ATO penalties
Director penalties
Reputational damage
Employers facing difficulties should seek advice promptly and consider voluntary disclosure to mitigate penalties.
Voluntary Disclosure
Employers should report underpayments promptly to reduce penalties and outstanding payments.
The ATO encourages early engagement to resolve issues and maintain compliance.
Additional Important Superannuation Updates for 2026 and Beyond
Increase in Concessional Contribution Caps
From 1 July 2026, the concessional contribution cap is expected to increase from $30,000 to $32,500, reflecting regular indexation. This cap limits the amount employees and employers can contribute to super at concessional tax rates.
Employers and employees should monitor these caps to optimise super contributions and minimise excess contributions tax.
Closure of Small Business Superannuation Clearing House
The government has announced the permanent closure of the Small Business Superannuation Clearing House from 1 July 2026. Employers using this service should plan alternative payment methods, such as commercial clearing houses or direct payments.
New Tax on Earnings Over $3 Million
An additional 15% tax on earnings will apply to superannuation balances exceeding $3 million from 1 July 2026, bringing the total tax rate on earnings to 30%. Balances over $10 million will be taxed at 40%.
High-balance members and their employers should be aware of these changes for retirement planning and compliance.
Low Income Super Tax Offset (LISTO) Updates
From 1 July 2027, the eligibility threshold for LISTO is proposed to increase from $37,000 to $45,000, with the maximum payment rising to $810. This change benefits low-income earners by increasing government contributions to their super.
Parental Leave Superannuation
Starting 1 July 2026, superannuation payments will be made on government-funded Paid Parental Leave for parents of babies born on or after 1 July 2025. This update supports parents by boosting their retirement savings during parental leave.
Medicare Levy Low-Income Thresholds
The Medicare levy low-income thresholds have increased, which may affect disposable income available for superannuation strategies, particularly for low-income earners.
Employers and employees should consider these thresholds when planning super contributions and tax obligations.
Frequently Asked Questions (FAQ)
Can I still pay super quarterly after 1 July 2026?
Most employers must pay at or near each payday. Quarterly payments may only comply if aligned strictly with payday deadlines, which is uncommon. It is best to transition to Payday Super to avoid penalties and late payment issues.
How will Payday Super affect cash flow?
More frequent payments may smooth cash flow by spreading super contributions across pay periods but reduce the ability to hold funds between quarters. Employers should adjust cash flow planning accordingly and consider cash flow tips for employers managing super payments.
Does Payday Super change total annual super paid?
No, the annual minimum SG rate remains 12%; only the payment timing changes.
What if payroll software can’t handle Payday Super?
Contact your provider early. Clearing houses or manual processes may help temporarily but upgrading systems is highly recommended.
How can employees check super payments?
Employees should check payslips and super fund accounts to confirm timely contributions and protect their retirement savings.
This expanded guide aims to provide Australian employers with comprehensive information on superannuation updates 2026, ensuring compliance with new laws and supporting effective payroll management. For the latest details and tools, visit the Australian Taxation Office (ATO) website regularly. Employers seeking accounting & bookkeeping services or advice on employer superannuation requirements, contact SmartDigits for expert assistance.
