Payday Super:

What Employers Need to Know Before 1 July 2026 

From 1 July 2026, a major change to how Australian businesses pay super will take effect. Known as Payday Super, this reform will require employers to pay superannuation guarantee (SG) contributions at the same time employees are paid, instead of the quarterly or monthly frequency they may be used to at present. 

This blog explains what the legislation involves, how the ATO plans to manage compliance, and what steps businesses should take now to prepare. 

Payday Super will change the rhythm of payroll for every employer in Australia. While it will help ensure employees receive their super promptly, it also means payroll systems, cash flow management, and compliance processes must adapt. 

Late or missed super payments already attracts the Super Guarantee Charge (SGC),  but from July 2026, the risk of late super consequences will increase for employers who are not ready. The ATO has made it clear that genuine compliance efforts will be supported, but inaction will not be tolerated. 

What is Payday Super and how does it works? 

Under the changes: 

• Employers must pay SG contributions with each pay cycle. 

• Payments must reach the employee’s super fund within 7 business days of each wage payment. 

• The late super SGC regime will be updated to include revised interest, penalties, and administrative mechanisms. 

The goal is to ensure employees’ super is paid more frequently, reducing unpaid balances, and improve retirement outcomes. 

ATO compliance approach: 

The ATO has released Draft Practical Compliance Guideline PCG 2025/D5 – Payday Super: First Year ATO Compliance Approach, which outlines its intended treatment during the transition year (2026–27). 

Employers who make genuine and timely efforts to comply, and who quickly correct any mistakes, are less likely to face enforcement in the first year. 

The ATO will consider: 

• Whether non-compliance is disclosed voluntarily and promptly 

• How quickly corrective actions are taken 

• The scale and frequency of issues 

• The strength of payroll governance and controls 

• The employer’s history of super compliance 

• Whether the employer is in an early transition stage 

The ATO stresses that the PCG does not provide a safe harbour. Even with good intentions, late or missed payments can still result in super shortfalls, interest, and penalties. 

What should business owners do? 

Before the change takes effect: 

• Review payroll software and ensure it can process super in real time. 

• Test super payment systems and clearing house timing.  Beam suggest that starting Payday super in advance of 1 July 26 may be an ideal way to test what is needed to meet the 7 days deadline and to iron out any issues well in advance of the legal start date 

• The ATO Small Business Clearing House will no longer be able to be used from 1 July 26.  It is already not able to be used by any businesses not previously registered to use it.  Beam suggest that businesses using this clearing house take proactive steps to transition away from it after their March 26 quarter super is paid.   

• Ideally if a business’s accounting software has an inbuilt Super Clearing House and ability to handle Payday Super, this is the ideal path to follow.  If that is not available there are some large Super Funds offering Super Clearing Houses which can be used in place of the ATO Small Business Clearing House.  These though do create additional work and more opportunities for human error. 

• Train payroll staff on the new rules and compliance expectations. 

• Set up governance procedures to track and approve super payments. 

Once Payday Super starts 1 July 26: 

• Process super payments on the same day payroll is paid to ensure super reaches employees funds within 7 business days of each pay cycle. 

• Keep complete payment and fund records for each employee. 

• Reconcile payroll and super data after every run. 

• Disclose any issues promptly to the ATO. 

How Beam Bookkeeping can help: 

Beam Bookkeeping supports businesses in preparing for Payday Super by: 

• Reviewing payroll software and system readiness 

• Testing pay and super alignment for real-time compliance 

• Assisting with documentation and process updates 

• Advising on payroll governance and record-keeping best practice 

Preparing early reduces stress and minimises financial risk.  Call Beam to help you transition your business smoothly to the new Payday Super framework. 

📧 [email protected] 
🌐 www.beambk.com.au 
📞 (02) 4957 3174