Article

Payday Super is coming. Here’s what we know.

25 February 2025 Read time: 3 min

Author Charlotte Whelan

Expert Reviewer Julie Kohler

Superannuation payments could be changing in a big way. Under the proposed Payday Super measure, super will move from the current system of quarterly payments to being due each time you process payroll. This change could be in effect from 1 July 2026.

What’s changing with payday super?

For individuals, this change is a big win! Payday super contributions will hit accounts more frequently, reducing the risk of unpaid or delayed super, and increasing the visibility on payments owed to you.

For businesses, this shift has major implications for admin, resourcing and cash flow. So, let’s explore what we know about the proposed payday super.

Super is due at time of payroll.

Whether your business runs weekly, fortnightly or monthly payroll, it will need to process super at the same time as employee wages – meaning super payments will be made much more frequently than the current quarterly system.

Super must reach employees within 7 days.

Payday super payments must also land in employee accounts within 7 days. This is one of the most contentious bits of the proposed legislation given the current super system affords employers 28 days from the end of each quarter to satisfy their obligations.

Further, payment clearing houses can’t currently guarantee the date funds land in employee accounts, and online bank processing timeframes vary widely. So we’ll be closely watching how this develops.

There will be penalties for late payments.

Like the current super system, if you underpay, miss or are late with a payday super payment, your business will be up for a raft of penalties and fines.

These include daily interest fees, late or underpayment fines and additional charges levied to reflect the cost of enforcement.

And – did you know these fees and fines are payable, even if late payment was no fault of your own (e.g. the clearing house failed to disburse payment in time, banking was delayed, an employee accidentally provided incorrect account information)?

Regardless of why payment is late, you’ll also need to submit a Superannuation Guarantee Charge Statement to the ATO, along with any monies owed.

Given the frequency of payday super payments, some experts have warned that fines and administrative effort under this new legislation could add up quickly, especially for small businesses and those with weekly payroll cycles.

I’m a business owner. What should I do about payday super?

If you’re a business owner, we recommend chatting with your bookkeeper about the proposed law soon. If you don’t currently have a bookkeeper, take this as the sign to engage one (here are some other signs it might be time to outsource your bookkeeping).

Some of the things to look at with your bookkeeper include:

Look at your payroll resourcing and systems.

Do you have the people, systems and processes in place to ensure super can be paid at the same time as wages? Consider capacity in your admin, finance and bookkeeping team, and any technology you’ll need to make this seamless.

Consider cash flow impacts.

How will payday super changes impact your business cash flow? We know running a small business can put major pressure on your household finances, so what can you do to insulate your family from the proposed changes? How can you start preparing your business for the cash flow impacts now?

Ensure good governance.

Make sure your business has good governance processes in place that allow you to record, report and prove you’re meeting your superannuation obligations.

Watch for technology and infrastructure updates.

The current clearing house system will need some major changes to ensure employers are able to easily comply with the proposed payday super laws. So keep your eyes peeled for new players to the market and for technology responses from digital service providers like Xero, MYOB and investment platforms.

Watch for regulatory updates.

Payday super is not let law and there will likely be a raft of changes to the proposed legislation before it comes into force.

Here at Kearney Group, we are closely watching how and when this legislation will be implemented.

One thing is clear though – business owners and those employing staff need to start getting prepared for the proposed changes, now. And the first step is reaching out to your accountant or bookkeeper to understand what’s coming down the line.

Are you payday super ready?

Is your bookkeeper across what needs to happen to get you ready for Payday Super? If you’re unsure, let’s talk.

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