From 1 July 2026, employers need to pay superannuation contributions at the same time they pay their employees’ wages. The Australian Taxation Office (ATO) is urging employers to get ready for the introduction of Payday Super now.
The Payday Super legislation, will take effect from 1 July 2026, meaning employers will be required to pay employees’ super at the same time as salary and wages.
Deputy Commissioner of the ATO, Emma Rosenzweig, said this is a once in a generation change and implored employers to get ready for the change now;
“Simply put Payday Super is about paying super on payday. Don’t wait until the last minute, we want employers to start planning for Payday Super now to ensure they are prepared for when the law takes effect.”
The Deputy Commissioner clarified that “You don’t have to wait to start paying super contributions more regularly. Many employers are already paying on pay day.”
Payday Super will help employers meet their super guarantee (SG) obligations and help protect the retirement funds of millions of Australians.
“This is a critical change in addressing unpaid super and deterring non-payment by employers while ensuring employees are fully compensated for any delays in receiving their super.”
“Payday Super will provide the ATO with earlier visibility of under-payment or non-payment of super, allowing for a proactive approach to compliance to reduce unpaid super,” Ms Rosenzweig said.
The ATO’s proposed compliance approach for the first year of Payday Super will recognise that employers who try to do the right thing, and resolve any issues quickly, will not be the focus of ATO compliance action.
“We’re working closely with industry groups, tax professionals, digital service providers and super funds to help prepare employers for the 1 July start date and we’ll be finalising clear guidance on factors we will consider in our compliance approach,” said Ms Rosenzweig.
What’s changing
At the moment, employers need to pay employees’ super contributions at least every 3 months and into the employee’s nominated account.
If an employer doesn’t pay super contributions on time, additional charges apply. Late payment of super may also breach the Fair Work Act or an applicable award or enterprise agreement.
From 1 July 2026, under the new laws, employers will need to pay employees’ super contributions at the same time they pay their salary or wages so that the contributions reach the employees’ nominated account within 7 business days. There are some exceptions, for example the first super contribution for a new employee will need to be made within 20 business days of the salary or wages being paid.
What employers need to do
The ATO is the primary enforcement agency for the compulsory super guarantee. The ATO is responsible for implementing the new rules and has prepared a fact sheet about the changes.
The ATO are advising employers to start thinking about how they will manage the transition ahead of these changes starting on 1 July 2026.
Employers should begin reviewing their payroll systems and business processes to make sure they’re ready. This may include speaking with their payroll software provider, accountant, or registered tax professional.
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They are provided as general advice and you should seek further advice on your situation. Members can do this by emailing employment@acapma.com.au.
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Elisha Radwanowski BCom(HRM&IR)
ACAPMA
