Payday Super is a legislative change that requires employers to pay Superannuation Guarantee (SG) contributions at the same time they pay employees’ salary or wages. The changes will commence on 1 July 2026. Employers will need to:

• Calculate super contributions each pay run
• Pay super at the same time wages are paid
• Move away from quarterly super payment cycles

This represents a cash-flow and process change, particularly for employers who currently pay super quarterly.

A more detailed overview of the changes is available here.

This reform is aimed at supporting individuals through:

• Reducing unpaid and late super
• Improving retirement outcomes by getting money into super earlier
• Increasing transparency

The policy is focused on individuals, however, will be implemented by employers, super funds and associated organisations.

Payday Super will commence on 1 July 2026. Under current legislation, the following timeframes apply:

• 7 business days – the time allowed for super to reach an employee’s super account after payday (also known as the usual period)
• 3 business days – the time a super fund has to allocate or reject a contribution once received
• 20 business days– the grace period for new starters or employees changing super funds (also known as the extended usual period)

See also:

• How Payday Super applies to new employees and changes of fund
• Example of the extended usual period

Other changes to be aware of include:

• Concessional contributions cap will rise to $32,500 on 1 July 2026
• Non-concessional contributions cap will rise to $130,000 on 1 July 2026

Please note that Stapling legislation remains in place and SG rates remain at 12%.

Note: see high income earner changes

Our checklist may be used to help assess readiness for Payday Super.

Employers should review systems and processes and engage with suppliers.

Preparation is sensible. There is no penalty for implementing changes ahead of 1 July 2026.

smartMonday is working closely with our administrator and other associated businesses to ensure operational readiness.

We are undertaking system capacity testing, reviewing internal processes and undertaking staff training.

A working group is in place internally, as well as with our administrator. We are participants in the Financial Services Council Payday Super industry working group, which involves industry representatives and aims to surface issues and concerns with a goal to finding joint resolutions.

Yes. Even if you already pay super with each pay cycle, the legislation may impact other internal processes including:

• Management of data errors and rejected payments
• Collection of new starter super information within tighter timeframes
• Ensuring business partners, such as payroll providers, and banking institutions are operationally ready for Payday Super

You may also wish to review staff communications or internal resources that reference super for any required updates.

It is important to take action ahead of the legislated start date to ensure systems and processes are ready.

Note: see high income earner changes

Employers who already pay super with each pay run may see a lower impact than those paying super quarterly.

The legislation will create:

• More frequent super payments
• Less flexibility in managing cash flow
• Higher operational reliance on payroll
• Increased reconciliation activity

If your cashflow and pay cycles need adjustments in order to implement Payday Super, such as moving salary payments from weekly to fortnightly, it is important to communicate with your staff about how and when these changes will be implemented.

Yes. The Small Business Super Clearing House (SBSCH) will close on 1 July 2026.

If you are using the SBSCH you will need to transition to another solution before Payday super commences.

If you have at least 20 employees who hold smartMonday membership, we can assist you with a clearing house solution.

Employers need to email the following details to employer@smartMonday.com.au.

• Company name and ABN
• Contact name
• Contact email address
• Contact mobile number (for two-factor authentication)
• Contact work address
• Bank account name
• Bank
• BSB
• Account number

This will generate an email back to you to gain access to our QuickSuper clearing house to be ready ahead of the Payday Super changes.

smartMonday will provide information to members closer to the implementation date to advise them to be aware of:

• Super being paid in line with pay cycles
• Keeping personal information up to date with both their employer and super fund for data matching purposes (e.g. Name changes)
• Taking extra care when making changes to their super arrangements, such as initiating a rollover or closing an account. Changes made part-way through a pay cycle may affect where contributions are received (or our ability to accept future contributions) so allowing time for updates to take effect is important.

• Your payroll provider, accountant, or accounting software provider
• The Australian Taxation Office (ATO): ato.gov.au/about-ato/new-legislation/in-detail/superannuation/payday-superannuation
• The Department of Treasury: treasury.gov.au/publication/p2024-581438
• Association of Super Funds (ASFA): superannuation.asn.au/payday-super-hub

When an employer makes a contribution to a particular super fund for an employee for the first time, the extended usual period applies. This means the contribution is due 20 business days after payday, rather than the usual period of 7 business days. The extended usual period applies when:

• An employee starts with an employer for the first time
• An employee returns after a break in employment
• An employee changes super funds, or the employer must start contributing to a new fund

See also: Example of the extended usual period

When paying an employee where the extended usual period applies, super is due 20 business days after payday.

If another payday occurs before the first contribution is due, then the later of the following applies:

• Seven business days after that payday, or
• The due date of the earlier contributions under the extended usual period.

This ensures later contributions are not due before earlier ones.

Example First Payday: Monday 1st

• 20 business days Super due: Monday 29th Second payday: Monday 15th +7 business days Usual due date: Wednesday 24th

Because this falls before the extended usual period due date, the second contribution is also due on Monday 29th.

Source: https://www.ato.gov.au/businesses-and-organisations/super-for-employers/payday-super/paying-super-on-payday/payment-deadlines-for-payday-super

Yes. Superannuation Guarantee Charge (SGC) arrangements will be updated.

The intent of the revised framework is to:

• Put workers in the same position as if contributions had been received in full and on time
• Incentivise employers to quickly disclose and rectify unpaid super
• Increase consequences for repeated non-compliance
• SGC will be calculated on the SG shortfall and notional earnings, with additional administration fees applied. If not rectified, further interest charges and penalties may apply. SGC is administered by the ATO.

While the ATO has indicated it will support employers through the transition, employers should plan for full compliance from 1 July 2026.

The way the cap is applied will change under Payday Super.

The current quarterly maximum contributions base will be replaced with an annual Maximum Super Contributions Base (MSCB).

Once an employee’s qualifying earnings for the financial year reach the annual MCB, the employer is not required to make further SG contributions for that employee for the remainder of the financial year.

You may need to review your payroll system rules to ensure the MCB is applied correctly on an annual, per-employee basis.

The legislation also sets out a new formula for the calculation of the MSCB which will accommodate future increases in SG rates and contributions caps. The formula is:

• 100 x Concessional Contributions Cap / SG Rate

With a 1 July 2026 increase to the concessional contributions cap, the calculation is as follows:

• 100 x $32,500 / 12 = $270,833*

Therefore, SG contributions are payable on qualifying earnings up to $270,833* per employee, per financial year with no SG obligations on earnings above this limit.

*2026/27 financial year shown

Please note: The Maximum Super Contributions Base (MSCB) sets out the required level of superannuation required under legislation. Employers may have separate employment or remuneration arrangements that provide for contributions above the MSCB. Contributions above the MSCB may be subject to different tax treatment for employees.

A Member Verification Request (MVR) is a digital request to confirm an employee is a current member of a particular super fund and that the fund can accept SG contributions for that person.

An MVR is designed to reduce the risk of rejected or refunded contributions by checking if the superannuation details an employer has for an employee matches the details a super fund has on record.

An MVR must be sent when an employer is making SG contributions to a super fund for the first time for a particular employee. This includes new employees, existing employees who have changed super funds and corrections after a contribution refund or rejection.

While not mandatory, changes to employee data such as name or TFN updates may also benefit from the submission of an MVR. This will help ensure member details are correctly matched and contributions can be processed without issue.

MVR’s are not required as routine checks before every pay cycle or for regular contributions. The MVR process is designed to support first-time contributions, not ongoing validation.

Using an MVR reduces the risk of contributions being rejected or refunded, which can create compliance issues under Payday Super. Verification helps ensure SG payments are accepted and applied correctly, and on time.

Super funds must respond to an MVR within 24 hours.

This means the super fund was unable to match the employee details provided to an active member account, or the account is not able to receive contributions. As a result, any contribution sent may be rejected or refunded.

You should not proceed with the contribution until the issue is resolved. Contact your employee to confirm their super fund details are correct and if needed update the employee’s details in your system. Submit a new MVR message once accurate information is available, to ensure the contribution can be accepted.