What is Payday Super?
Payday Super is a major change to how employers calculate and pay superannuation. From 1 July 2026, employers must pay super guarantee (SG) at the same time as wages, instead of quarterly.
What this means
- Super is calculated on each pay run
- Payments must reach the employee’s super fund within 7 business days of payday (20 days for new employees)
- Reporting is done through Single Touch Payroll (STP) every pay cycle
The goal is to ensure employees receive their super sooner and reduce unpaid super across Australia.
When does it start?
As mentioned above, Payday Super comes into effect on 1 July 2026.
Key transition points
- Final quarterly super payment: 28 July 2026 (April–June quarter)
- From 1 July 2026: all new earnings must have super paid on payday
- The Small Business Super Clearing House (SBSCH) closes permanently on 30 June 2026
You don’t need to wait until July. Many businesses are starting early to smooth the transition.
What is Qualifying Earnings (QE)?
Qualifying Earnings (QE) is the new basis for calculating super under Payday Super.
QE includes
- Ordinary Time Earnings (OTE) (e.g. wages, annual leave, allowances)
- Commissions
- Certain bonuses and lump sums
- Salary sacrifice amounts (if they would otherwise be included)
- Payments to some contractors treated as employees for super purposes
From 1 July 2026
- SG = 12% of qualifying earnings
- Both SG and SGC will use the same earnings base (QE)
For most businesses, this won’t drastically change the amount of super paid but standardises how it’s calculated.
What is an SG Shortfall?
An SG shortfall occurs when you don’t meet your super obligations, such as:
- Paying less than required
- Paying late
- Paying to the wrong fund
Under Payday Super, this becomes much stricter because:
- Super must be paid every payday
- Funds must receive it within 7 business days (20 days for new employees)
Even small delays can trigger compliance issues.
What is the Super Guarantee Charge (SGC)?
The Super Guarantee Charge (SGC) is the penalty applied when super isn’t paid correctly.
From 1 July 2026
- Applies if super isn’t received within 7 business days of payday (20 days for new employees)
- Is calculated on qualifying earnings
- Includes: Interest and an administrative uplift (based on compliance history)
- Is tax deductible under the new rules (excludes general interest and imposed late payment penalty)
This is a shift from the current system, where SGC is:
- Based on salary and wages
- Includes fixed admin fees
- Is not tax deductible
Going forward, late super will become more visible and more enforceable.
What is SuperStream?
SuperStream is the system used to send super payments and employee data electronically to super funds.
From 1 July 2026, SuperStream is being upgraded to improve:
- Speed – payments may be received same-day using the New Payments Platform (NPP)
- Accuracy – better validation of employee details before payment
- Error handling – clearer and faster error messages
- Data quality – earlier visibility of super fund changes
A key new feature is the Member Verification Request (MVR), which helps confirm employee super details before sending payments—reducing rejections.
What is changing overall?
Here’s the simple comparison:
Before (current system):
- Super paid quarterly
- Based on OTE
- Report either OTE or super in STP
From 1 July 2026:
- Super paid every payday
- Based on qualifying earnings (QE)
- Must report both QE and super liability in STP
- Payments must be received within 7 business days
Xero is already Payday Super ready
Most modern payroll platforms like Xero accounting software are already preparing for Payday Super.
This typically includes:
- Automated super calculations using QE
- STP reporting updates
- Integrated super payments
- Alerts for errors or missing details
However, readiness depends on:
- Your payroll setup
- Data accuracy (employee super details)
- Your payment workflows
Software helps but process and setup still matter.
Balanceable can help sort the noise
Payday Super isn’t just a compliance change. It’s a cash flow and process change.
At Balanceable, we help businesses:
- Review payroll and super processes
- Ensure software is set up correctly
- Clean up employee super data
- Plan for cash flow impacts
- Avoid SGC penalties
The earlier you prepare, the smoother the transition.
Resources
Australian Taxation Office Payday Super Resources
Qualifying Earnings (QE)
Compliance Approach