Paying super on the same day as payroll is coming

What is payday superannuation?

From July 1^st 2026, employers will be required to pay their employees’ super at the same time as their salary and wages. This is known as Payday superannuation. The start date will provide employers, super funds, and payroll providers with sufficient time to prepare for the change. This measure is not yet law.

Whilst there are benefits to Payday superannuation, there are also some potential problems to consider.

Read on to learn more.

Benefits of payday superannuation

There are many benefits to payday superannuation including;

It reduces the risk of unpaid superannuation. When super is paid quarterly, there is a higher chance of employers failing to make the payments, especially if they face financial difficulties. Paying super on each pay run ensures employees receive their full entitlements promptly.
It reduces the risk of employers facing Superannuation Guarantee Charge (SGC) which is not only an administrative burden but also results in interest charges and administration fees.
It improves retirement savings. By contributing super more frequently, employees can benefit from the compounding effect of investment returns over a longer period, potentially resulting in higher retirement balances.
It streamlines payroll processes. Paying super on each pay run aligns the payment cycle with the existing payroll system, reducing administrative burdens and potential errors associated with separate quarterly payments.
It enhances compliance and enforcement. The Australian Taxation Office (ATO) will be better equipped to detect and recover unpaid super contributions earlier, as employers will be required to report and pay super on each pay run.

Potential challenges with payday superannuation

Whilst the benefits are obvious, there are also some potential challenges with Payday superannuation. Following are some potential downsides to lodging superannuation contributions on every pay run:

Increased administrative burden for employers: Processing super payments more frequently (e.g., weekly or fortnightly) instead of quarterly can increase the administrative workload and costs for employers, especially smaller businesses with limited resources.
Cash flow implications: Employers may face tighter cash flow constraints as they need to set aside funds for super contributions more regularly, which could be challenging for businesses with irregular or seasonal income streams.
Potential for more errors: With more frequent super payments, there is a higher chance of errors occurring, such as incorrect employee details or contribution amounts, which could lead to compliance issues and penalties from the Australian Taxation Office (ATO).
Transition costs: Implementing the payday super system may require employers to upgrade their payroll software or processes, incurring additional costs and resources during the transition period.

Regardless, the Australian government believes that the benefits of payday super, such as reducing unpaid super, improving retirement savings, and enhancing compliance, outweigh these potential downsides.

Ready to start payday superannuation reporting?

QuickBooks Payroll powered by Employment Hero, is one of the software providers that has already implemented functionality to the pay schedule settings. This functionality includes the option to automatically create a super payment when finalising the pay run. Having this functionality ensures that superannuation contributions from each pay run are batched together, and saves payroll officers having to do this as a completely separate process in the reporting section.

It’s important to be aware before you start that this feature is only available to Full Admin users and users with Beam integration enabled. For users without Beam integration, super payments created from the pay run will be created as a manual super payment by default.

How to Enable super payments within your Pay Schedule settings.

As part of the pay run finalisation process, users can now select to create a super payment immediately, or manually at a later date. Follow the steps below to set it up.

Select Payroll from the left-hand navigation menu.
Select Payroll Settings.
Select Pay Schedules.
Select an existing Pay Schedule to edit it.
Select the hyperlinked word, here, under the Pay run finalisation settings heading.
A window will pop up and you can tick the box to create super payment immediately or manually at a later date.
To save your changes, select Next, then Complete.

If you selected immediately, and the pay run is finalised, you can select Review super payment to automatically navigate to the Manage Super Batch payment screen where the super contributions for the pay run will be populated.
If you selected manually at a later date, and the pay run is finalised, you can create a super payment by selecting Create super payment on the pay run actions menu. Then, you will be navigated to the Manage Super Batch Payment screen where the super contributions for the pay run will be populated.

Checking your super status on the pay runs page

You can check the status of your super payment on the pay runs page by hovering over the super icon located next to the date paid column.

Grey: when the icon is grey, the super payment hasn’t been submitted (Beam super payments) or marked as paid (Manual super payments).
Yellow: when the icon is yellow, the super payment has been submitted, this icon will only appear for users with Beam integration enabled.
Green: when the icon is green, the super payment has been received (Beam super payments) or marked as paid (Manual super payments).
Red: when the icon is red, the super payment has failed, or there may be an error or return to your super payment, this icon will only appear for users with Beam integration enabled.

Need help getting started with payday superannuation?

We are here to help. Please contact us if you’d like to get started with Payday superannuation.

Tax, Uncategorised