Preparing for 1 July 2026

From 1 July 2026, the way you pay superannuation will change. To ensure employees’ retirement savings are paid more frequently and invested sooner, the Australian Government is moving from a quarterly system to Payday Super.

What is Changing?

Currently, super is paid at least quarterly. Under the new rules, you must pay your employees' super guarantee (SG) at the same time you pay their salary and wages.

• The 7-Day Rule: Super contributions must be received by the employee’s super fund within 7 business days of payday.
• Qualifying Earnings (QE): A new concept that streamlines Ordinary Time Earnings (OTE) and salary sacrifice amounts into one calculation base for your 12% super obligations.
• Visibility: The ATO will match your Single Touch Payroll (STP) data against fund receipts in real-time to identify late payments instantly.

Qualifying Earnings (QE)

Qualified Earnings is a new, simplified definition of the earnings used to calculate superannuation under the Payday Super rules.

• As of early 2026, the ATO has standardized this term to replace the guesswork that sometimes occurred with the old Ordinary Time Earnings (OTE) system.
• Starting 1 July 2026, you will use QE as the single base for both calculating your super obligations and reporting to the ATO via Single Touch Payroll (STP) as a separate field.

What’s Included in QE?

For most employers, QE covers exactly what you are currently paying super on, but it formally "locks in" certain items to avoid confusion.

A Summary is provided below. View full details via this link:

Employer Action Plan

1. Upgrade Your Software: Confirm with your payroll provider (e.g., Xero, MYOB, QuickBooks) that their system is updated for Payday Super and can automate the 7-day payment window.
2. Audit Employee Data: Ensure all Super Fund USIs and member numbers are 100% accurate. Under Payday Super, a "bounced" payment due to wrong details can cause immediate non-compliance.
3. Review Cash Flow: Since super is no longer a quarterly "bill" but a weekly/fortnightly expense, ensure your business has the liquidity to cover SG alongside wages every pay run.
4. Transition from SBSCH: If you still use the ATO Clearing House, you must switch to a commercial clearing house or a payroll-integrated solution before 30 June 2026.Note that you will be unable to pay your June 2026 quarterly super after 30 June 2026 through the SBSCH.

What about new employees?

For new employees, you have an extended timeframe of 20 business days for the very first payment to allow for fund setup and checks.

Key Deadlines

Penalties & Compliance

The ATO's visibility is increasing. If a payment is not received by the fund within the 7-business-day window:

• Super Guarantee Charge (SGC): You will be liable for the SGC, which includes interest and administrative fees.
• Deductibility: While some late payments may remain deductible, SGC paid to the ATO is not tax-deductible, significantly increasing the cost to your business.
• Strict Enforcement: The ATO will use a risk-based approach, but frequent "glitches" or late runs will trigger audits.

Where to Get Help

• ATO Official Portal: via this link for checklists and technical guides.
• The Power Tynan Team are ready and able to assist with your Payday Super Transition.

Download our Payday Super: Employer Readiness Checklist here