iscover Most businesses unprepared for Payday Super ahead of looming start date
BusinessLess than 5 per cent of tax specialists in a survey have said the businesses they work with were fully prepared for the changes, according to The Tax Institute.
A recent survey by The Tax Institute has revealed that there is considerable work to be done ahead of the Payday Super start date, with many businesses still implementing key changes under the new regime.
The transition to Payday Super represents a significant shift in how superannuation is paid and administered, requiring employers to pay super at the same time as wages from 1 July.
Only a small proportion of tax professionals surveyed said the businesses they work with have completed the necessary changes needed for the new regime.
Just 4.55 per cent of the professionals surveyed said the businesses they work with were fully prepared, while only 5.25 per cent said that their business clients had completed the implementation of the new payment standard.
The majority of tax professionals surveyed said that businesses were still in the early planning stages for Payday Super.
According to the Tax Institute survey, the main implementation hurdles included payroll system readiness and increased costs, particularly for small- to medium-sized businesses (SMBs) facing growing regulatory burdens.
Most practitioners in the survey said businesses will need three to six months to prepare for payday super, while 23.38 per cent said businesses would need more than six months.
Julie Abdalla, head of tax and legal at The Tax Institute, said the survey findings highlight the pressure many businesses faced to pivot and comply within a short window before the start date.
"Only a small proportion of respondents indicated they feel fully prepared for the transition, while many reported they are still assessing payroll impacts or working through the practical changes required with their clients," she said.
"This demonstrates that there is still considerable work to be done ahead of the start of Payday Super."
Abdalla said while the policy was designed to improve the timeliness and accuracy of super payments for employees, many employers were concerned about the upfront time and resource investment required to make changes to payroll systems, business processes and, in some cases, cash flow management.
"The survey findings highlight the pressure many businesses are under to pivot and comply within a short window before the start date," she said.
"They also reinforce the importance of businesses seeking the assistance of a Chartered Tax Adviser or other appropriately qualified tax professional, so they can prepare effectively, and ensure the transition is as smooth as possible.”
Miranda Brownlee
Miranda Brownlee is the editor of Accountants Daily and Accounting Times, the leading sources of news, insight, and educational content for professionals in the accounting sector.
Miranda has over a decade of experience reporting on the financial services and accounting sectors, working on a range of publications including SMSF Adviser, Investor Daily and ifa.
