iscover Tax Office dispels common myths about Payday Super
BusinessMany employers are underestimating the preparations needed for the new regime and incorrectly assuming there is nothing to do until 1 July 2026, the ATO has said.
ATO deputy commissioner Emma Rosenzweig has outlined some common questions and myths the ATO has encountered regarding Payday Super as the 1 July deadline draws closer.
Rosenzweig said one of the biggest misconceptions she is hearing from businesses is that there is nothing to do until the start of the new financial year.
While Payday Super starts on 1 July, Rosenzweig cautioned that many employers will need time to prepare.
"That might mean planning for cashflow changes, checking payroll systems are ready, or transitioning away from the ATO’s Small Business Superannuation Clearing House (SBSCH), which permanently closes 1 July," she said.
"Remember, you won’t be able to access the service or your SBSCH records once it closes. There will be no read‑only access. So, make sure you download your SBSCH records and transition early to your new provider."
Rosenzweig said many employers have also assumed they can just change how often they pay their employees.
"Payday Super doesn’t change pay frequency. How often you pay your employees is set by employment contracts, awards or enterprise agreements," she said.
She reminded businesses that from 1 July 2026, they must pay super each payday, in line with how often they pay wages.
"So, if you pay wages weekly, you pay super weekly or if you pay wages fortnightly, then you pay super fortnightly."
She also noted that super payments must be received by the employee’s super fund within seven business days after payday.
"Importantly, a payment only counts once it’s received by the fund, not when it’s submitted," she said.
"Waiting until day 7 can be risky, especially if a payment is rejected and needs correcting. That’s why we recommend paying super on payday, where possible, to give yourself the most time."
Rosenzweig also assured employers that where they make an honest mistake, they will not be penalised immediately.
"We know most employers want to do the right thing. Employers who make an honest mistake and take steps to fix it quickly won’t be the focus of our compliance action."
The ATO's practical compliance guideline outlining its compliance approach for the first year of payday super outlines where the ATO will focus its attention.
"We've also recently published the Payday Super draft law companion rulings outline how the new rules will apply to help your business prepare for Payday Super changes. To have your say on these rulings, provide your feedback by 1 May," she said.
"I encourage you to take the time now to prepare, and you’ll head into July with confidence."
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Miranda Brownlee
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.
