Please note that Payday super is currently only proposed legislation and is currently in the consultation stage and has not yet been introduced or passed. The below information is provided for you to be aware of the potential changes and have early discussions with us if this legislation were to pass on how these changes may impact you.
As part of the 2023–24 Federal Budget, the federal government announced “payday super”, which will require employers to make superannuation guarantee (SG) payments for their employees at the same time as their salary and wages. This measure aims to tackle the issue of superannuation payment delays and ultimately improve retirement outcomes for workers.
Current requirements
Employers are currently required to make quarterly super payments due on 28th day of the month following the end of the quarter. For example, SG for the January to March quarter is due for payment by 28 April.
Proposed Future requirements
If this legislation was to pass, from 1 July 2026, employers will be required to pay their employees super at the same time as their salary and wages.
Two Payday Super models have been suggested, for employers to choose from:
- Employer Payment Model: requires payment of SG contributions on the day that payment of salary or wages are made; or
- Due Date Model: requires contributions to be received by the super fund within a certain number of days following payday.
Impact for employees
Employees will gain better visibility over whether their superannuation entitlements have been paid in time. This may be beneficial to them when moving from one employer to another.
The ATO will initiate SG charge assessments through their own compliance activities more frequently with lower reliance and need for cases to be raised through employee notifications.
Employees who may reach the concessional contributions cap in 2026–27 will not be disadvantaged due to the policy change, temporary transition arrangements to contribution caps may be made account for contributions that otherwise would have been accounted for in the 2027–28 year but will be brought forward into the 2026–27 year in a payday super model.
Impact for employers
A 2026–27 income year commencement date will give enough time for payroll service providers selected by employers and superannuation funds selected by employees to make necessary system changes.
Employers will also have considerable time and notice to adjust their cash flow practices and plan for any changes that may be necessary.
Rather than issuing SG charge assessments as soon as the debt accrues, the ATO will complete regular, scheduled reconciliations where they issue all SG charge assessments that have accrued in the preceding period. These reconciliations would occur after the period under review.
Get in touch
With the proposed measure due to commence in the 2026–27 income year, there is plenty of time to prepare and plan for these changes.
If you would like to reflect on your current cash flow practices and plan ahead for the increased frequency of super payments, please get in touch with us.
