The Australian superannuation system has been undergoing some major changes recently, the most recent being the Payday Superannuation Bill that passed in Parliament on the 4^th November. 

This means all employers will need to be ready by the 1^st July 2026 to pay superannuation to their employees within 7 days of making a salary or wage payment or now referred to as a *Qualified Earnings (QE) payment. These changes should not come as a shock to businesses, especially those that are notoriously late paying super to their staff or some businesses not even paying super at all.

With the Australian Taxation Office estimating $6.25 billion worth of super being unpaid in the 2025 financial year this system is paramount to protect the future income of hard working Australians. By introducing this system, it will enable the ATO to detect non-compliance faster and impose harsher penalties where required for the high-risk businesses.

Some of the benefits that come from introducing the new Payday system:

1. It strengthens accountability of employers in fulfilling their obligations, therefore making the system fairer.
2. It supports better retirement outcomes by ensuring contributions are made earlier and more frequently, thereby increasing the growth of superannuation balances.
3. It is aligning the superannuation system with modern payroll practices
4. It addresses the long-standing issues around “super gaps”, where super is paid late or isn’t paid at all impacting retirement security

This will provide many challenges for businesses on both an operational and compliance level. Firstly, businesses have until 1 July 2026 to get their software up to date to ensure they are able to pay their staff’s superannuation on time. For those businesses who still rely on the Small Business Superannuation Clearing House, this has already become unavailable to new users and will no longer be available for current users from 1 July 2026. Most businesses who are already using software to run their business are likely to already have the ability to make superannuation payments directly from their software but have not used these features. It’s best to contact your software providers sooner rather than later to get this up and running before the changes come into effect.

It is best to also use this time to review all internal processes, systems and staff responsibilities prior to this coming into effect to ensure the business has the capability to process their superannuation on lodgement time as well as make the payment. So not only will the business need to manage their systems and processes but also their cashflow as the increased frequency in cash outflow is likely to impact other financial obligations.

This change was never meant to be easy on businesses but essential if we want to protect our vulnerable Australians and their future retirement.

*QE payment includes ordinary time earnings (OTE), salary sacrificed superannuation contributions and any other amounts which are included in their salary and wages for superannuation guarantee.

**The minimum superannuation guarantee contributions are based on an employees ordinary hours of work (OTE). An extensive list can be found using this OTE link.

Written for you by Jade McKee