From 1 July 2026, superannuation must be paid on or before payday — not quarterly. This is the biggest change to super obligations in 30 years, and most small businesses aren't ready.
Currently, employers must pay the Superannuation Guarantee (SG) — 12% of ordinary time earnings — within 28 days after the end of each quarter. This means super can legally be paid up to 4 months after the pay period it relates to.
From 1 July 2026, employers must pay SG contributions on or before the employee's payday. If you pay weekly, super is due weekly. If you pay fortnightly, super is due fortnightly. Monthly pay, monthly super.
12%
Current SG rate
7 days
Grace period after payday
$0
Minimum earnings threshold
Key dates
Date
What happens
1 July 2026
Payday Super commences — SG must be paid on or before payday (with 7-day grace period)
Q1 FY27 (Jul–Sep 2026)
ATO "soft landing" approach — focus on education, not penalties (for genuine attempts to comply)
1 January 2027
Full enforcement expected
Who this affects
Every employer in Australia. There are no exemptions based on business size, industry, or employee type. Key points:
The $450/month earnings threshold was already removed on 1 July 2022 — super is payable on all earnings regardless of amount
Casual employees are included — super is due on every casual pay run
Part-time employees are included
Employees under 18 who work more than 30 hours per week are included
Penalties for late payment
The penalty framework under Payday Super is designed to be proportionate but firm:
Superannuation Guarantee Charge (SGC) — if you're late, you pay the SGC which includes the shortfall amount, nominal interest (currently 10%), and an administration fee. The SGC is not tax-deductible.
Part 7 penalty — the ATO can impose an additional penalty of up to 200% of the SGC amount for serious or repeated non-compliance
Director penalties — directors can be held personally liable for unpaid SGC under the Director Penalty Regime. If you don't report and pay within 3 months, the penalty becomes a lockdown penalty — it can't be remitted, even if the company later pays
The 7-day grace period: You have 7 calendar days after payday to ensure the super contribution reaches the employee's fund. But don't rely on this as standard practice — processing times vary between super funds, and if the money doesn't arrive within 7 days, you're non-compliant.
How to prepare before 1 July
Talk to your payroll provider — confirm their system supports same-day or same-cycle super payments. Most major payroll platforms (Xero, MYOB, QuickBooks) have already released Payday Super updates.
Update your pay cycle — if you're currently paying super quarterly through a manual process, you need to switch to per-pay-run processing
Set up SuperStream — ensure your super contributions are being made through a SuperStream-compliant channel (most clearing houses and payroll systems handle this)
Verify employee fund details — stapled super fund lookups, correct fund USIs, and employee TFNs should all be current
Cash flow planning — quarterly super meant a lump sum every 3 months. Payday Super means smaller, more frequent payments. Adjust your cash flow accordingly.
Review contractor arrangements — if any of your contractors are actually employees (under the new "real substance" test), you'll owe them super on every pay run from 1 July
Payroll system checklist
Before 1 July, confirm your payroll system can:
Calculate and submit SG contributions on each pay run (not quarterly)
Process SuperStream payments within the 7-day grace period
Handle multiple super funds across different employees
Report SG through Single Touch Payroll Phase 2
Flag overdue contributions before the grace period expires
Ready for Payday Super?
Our free health check covers superannuation obligations and 17 other compliance areas. Find your gaps before 1 July.