If you run a small or medium business in Australia, payroll compliance is about to change again. From 1 July 2026, employers will be required to pay superannuation on payday, not quarterly. This reform known as Payday Super is designed to improve employee outcomes, but it also means tighter processes and less room for error for business owners and admin teams.
As accountants who specialise heavily in business payroll and compliance, we’re ready to help clients prepare.
What is Payday Super, in plain English?
Under the current system, most employers calculate and pay superannuation quarterly. Payday Super changes that rhythm. Instead, super will be calculated and paid in line with each pay cycle—weekly, fortnightly, or monthly—through upgraded SuperStream processes.
This means super obligations will become part of your regular payroll workflow, not a separate quarterly task. From our experience, businesses that rely on manual workarounds or loosely defined pay items will feel this change the most.
Qualifying Earnings (QE): the new term you need to understand
Qualifying Earnings (QE) is the new base used to calculate Super Guarantee (SG) contributions under Payday Super.
In simple terms, QE represents the earnings that super is calculated on each pay run, rather than being reviewed in arrears at the end of a quarter. The SG amount will be calculated as 12% of qualifying earnings, paid at the same time as wages.
According to the Australian Taxation Office, QE closely aligns with what is currently considered salary or wages for super purposes—but the difference is timing and visibility. Errors will surface immediately, not months later.
From a compliance perspective, this makes payroll accuracy more important than ever.
What payments are included in Qualifying Earnings?
While the legislation is still being finalised, the ATO has clarified that QE will generally include:
- Ordinary time earnings (OTE)
- Base salary and wages
- Allowances that are considered part of salary or wages
- Salary sacrifice amounts paid to super
What matters most is how your payroll system classifies pay items. We often see issues where allowances, bonuses, or leave types are inconsistently set up. Under Payday Super, these misclassifications can lead to underpaid super on every pay cycle—not just once a quarter.
The calculation itself isn’t complicated. Getting the data right is.
What this means for payroll and cashflow
From a practical standpoint, Payday Super has two major implications:
- Cashflow timing changes
Super will no longer be held and paid quarterly. Businesses will need to ensure sufficient cash is available at each pay run. This doesn’t increase the total cost of super—but it does change when the cash leaves your account. - Payroll processes must be tighter
With super calculated every pay cycle, there’s less room for manual fixes. Payroll systems need to be set up correctly, staff need clear processes, and reporting needs to be consistent.
For many businesses, this is where professional support makes a real difference.
A practical Payday Super readiness checklist
Based on what we’re doing with clients right now, here’s how we recommend preparing:
- Review all payroll pay items and map them correctly to qualifying earnings
- Confirm your payroll software will support Payday Super and SuperStream changes
- Update cashflow forecasts to reflect pay-cycle super payments
- Run test pay runs to confirm QE calculations and SG amounts
- Document payroll processes so admin staff can apply them consistently
The ATO has released employer resources, including checklists and fact sheets, but implementation is where most businesses need help.
How we help
Payroll and super compliance is a core part of our accounting practice. We work closely with businesses to review payroll setups, correct pay item classifications, and build processes that scale as your business grows.
If you’d like us to review your payroll and help you prepare for Payday Super well before 1 July 2026, we’d be happy to help. Getting this right early puts you in control rather than scrambling later.
Get in touch with our team to book a Payday Super readiness review.
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