Payday Super Guide
for Small Business
What you need to know to prepare for the future of super payments.
@jadaccountingandbookkeeping.com.au
Payday Super is a major Australian Government reform requiring employers to pay their employees' superannuation guarantee contributions at the same time they pay their wages (whether weekly, fortnightly, or monthly).
The law comes into effect 1 July 2026.
What is Payday Super?
Qualifying Earnings (QE) is the new, standardized legal framework used to calculate the Superannuation Guarantee (SG) amount an employer must pay an employee. QE is a new term that combines ordinary time earnings (OTE) and other payments.
QE is comprised of several components:
What are qualified earnings?
Paid leave (annual, sick, long service)
✓
Allowances (certain types): Most allowances that covered skilled work, on-call, adverse conditions and retention. Does not include expense allowances.
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Performance bonuses: Regular, measurable bonuses tied to job performance
✓
All commissions: Any commission earned, even if it is generated completely outside your ordinary hours of work
✓
Salary and wages: Payments for ordinary hours of work.
✓
What qualified earnings don’t include are:
✗
✗
✗
Expense allowances: Where money is expected to be paid by the employee (meal allowances).
Termination payments: Payments received, such as redundancy and unused annual leave.
Overtime payments: True overtime hours paid outside standard award structures.
What Payday Super means for employers
This change requires employers to adjust their payroll activities to include more frequent superannuation payments. Under the old process, quarterly payments were mandatory. Under Payday Super, businesses go from paying super at a minimum of 4 times a year to potentially 52 times.
Employers must report both QE and super contributions in Single Touch Payroll (STP). The New Payments Platform (NPP) will be implemented for Payday Super to ensure super funds receive super contributions on the same day.
Missed, late, or underpaid super contributions will result in the superannuation guarantee charge (SGC).
Employers will need to find a superannuation clearing house provider as the ATO’s Small Business Super Clearing House will close on 1 July 2026.
Payday Super process explained
To see how this works in practice, here is a breakdown of a standard fortnightly pay run under the Payday Super framework. Here is the example:
Work and Earnings
Marcus’s qualifying work and earnings total exactly $3,000 for the fortnight. This amount reflects the labor he performs during his standard rostered hours, which generates $2,500 in base salary, a $400 store sales bonus, and a $100 hazard allowance for handling faulty batteries. His overtime work and expense reimbursement are excluded from this definition because they do not count as ordinary labor or regular compensation under the law. Ultimately, this $3,000 total serves as the exact base his employer must use to calculate his 12% superannuation contribution.
The payroll software processes Marcus's pay run on payday by isolating his $3,000 in qualifying earnings and excluding his overtime and reimbursements. The system instantly calculates his mandatory 12% superannuation guarantee contribution, which equals exactly $360.
Pay Run & Super Calculations
Payment Processing
Payday Super Compliant
For the payment processing phase, the employer submits Marcus’s real-time wage and super data to the ATO via Single Touch Payroll (STP). Simultaneously, the business authorizes the transfer and routes the $360 out of the company bank account using an upgraded SuperStream 3.0 clearing platform.
To remain fully Payday Super compliant, the business ensures the $360 successfully clears and settles into Marcus's super fund within the strict 7-business-day deadline. Meeting this tight window protects the business from automated ATO non-compliance flags, daily compounding interest penalties, and the loss of their corporate tax deduction.
Payday Super Process Timeline
1
Work
performed
2
QE calculated
in pay run
3
STP declares
QE and super
4
QE and super
paid same day
5
Super fund receives
contribution
6
Fund notifies
ATO
Employer Action Plan - Get Ready for 1 July 2026
Impact on Small Business
KEY TAKEAWAYS
Payday Super- What Every Employer Must Know
From 1 July 2026, super must be paid
on every payday, not quarterly.
Contributions must be received by the super
fund within 7 business days of payday.
Super is now calculated on Qualifying
Earnings (QE)—broader than the old OTE basis.
The SBSCH closes permanently on
30 June 2026.
Migrate to SuperStream now.
Late payments trigger ATO-assessed SGC with compound daily interest,
no more self-assessment.
Cash flow planning is critical — treat super as a per-pay operational cost, not a quarterly bill.