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Australia's draft Payday Super legislation requires employers to pay superannuation guarantee (SG) contributions on the same day as salary and wages, effective July 1, 2026. Contributions must reach employees' superannuation accounts within 7 business days of payday, replacing the current quarterly payment cycle. The maximum contributions base shifts from quarterly to annual (AUD 250,000 for 2026-27). Employers must report qualifying earnings (code Q) and superannuation liability (code L) in Single Touch Payroll (STP) year-to-date fields. Superannuation guarantee charge amounts (excluding interest and penalties) become tax deductible.
Australia mandates same-day superannuation payments from July 1, 2026
Australia's draft Payday Super legislation requires employers to pay superannuation guarantee (SG) contributions on the same day as salary and wages, effective July 1, 2026. Contributions must reach employees' superannuation accounts within 7 business days of payday, replacing the current quarterly payment cycle. The maximum contributions base shifts from a quarterly to an annual cap of AUD 250,000 for the 2026–27 financial year.
Who is affected
All Australian employers paying superannuation guarantee contributions. The change applies to all employees receiving ordinary time earnings and salary sacrifice contributions, regardless of company size or industry.
What's changing
Payment timing
Employers must remit SG contributions on each payday (termed "Qualifying Earnings Day"), replacing the current quarterly payment cycle. Contributions must be received in the employee's superannuation account within 7 business days. Limited exceptions apply for natural disasters, system outages, fund mergers, out-of-cycle pay runs, and rejected stapled fund contributions.
Maximum contributions base
The cap changes from quarterly to annual. For 2026–27, the annual maximum contributions base is AUD 250,000, calculated as: (Concessional contributions cap × 100) ÷ charge percentage = (AUD 30,000 × 100) ÷ 12.
Single Touch Payroll (STP) reporting
From July 1, 2026, employers must report qualifying earnings (code Q) and superannuation liability (code L) in STP year-to-date fields. Qualifying earnings include ordinary time earnings as defined by the Australian Taxation Office (ATO), plus superannuation salary sacrifice contributions.
Tax deductibility
Superannuation guarantee charge (SGC) amounts become tax deductible, excluding general interest charge and penalties.
What NEO partners and clients should do
- By July 1, 2026: Confirm payroll software provider has implemented STP code Q and L reporting; test updates before go-live.
- By July 1, 2026: Audit pay codes and payroll elements to ensure accurate classification of ordinary time earnings and superannuation contributions.
- Before July 1, 2026: Model cash flow impact of moving from quarterly to per-payroll remittance and implement automated remittance workflows.
- Before July 1, 2026: Train payroll teams on qualifying earnings definitions, the annual contributions base calculation, and new STP reporting requirements.
