Australia’s superannuation system is going through one of its biggest changes in decades. From 1 July 2026, employers across the country will be required to pay Superannuation Guarantee contributions every payday, not quarterly as they do now. This reform, known as Payday Super, will change how payroll, cash flow, and compliance are managed at every level of a business.For employers, payroll managers, bookkeepers, and HR professionals in Melbourne, understanding what is changing and what needs to be done is critical.
This guide explains what Payday Super is, why it is being introduced, and what Melbourne employers need to do to get ready before 1 July 2026.
Key Changes at a Glance
Before getting into the details, here is a quick summary of what is changing and what is staying the same.
What is changing:
Super is no longer paid quarterly. From 1 July 2026, super must be paid on every single payday. If a business pays staff weekly, super goes out weekly. If the pay cycle is fortnightly, super goes out fortnightly. The payment must reach the employee’s super fund within a few days of each pay run.
What is staying the same:
The super guarantee rate continues to apply. Employers must still contribute the correct percentage of an employee’s ordinary time earnings. The eligibility rules for who receives super also remain largely the same.
What this means for employers:
Super payments will need to be managed much more frequently. Payroll software, cash flow planning, and record keeping all need to be ready for this shift. The good news is that with the right preparation, it is very manageable.
What Is Payday Super?
Right now, employers in Australia pay super once every three months. This is called quarterly super contributions. Most businesses have been doing this for years. But from 1 July 2026, that changes. Under the new Payday Super rules, employers will need to pay super at the same time as wages. So every time payroll is processed, super must go with it.
The Australian Government announced this change to help workers build their retirement savings faster. When super is paid more often, it earns more interest over time. For workers, this adds up to thousands of extra dollars by the time they retire. For employers, it means a big shift in how payroll works.
Why Is This Change Happening?
The government has two main reasons for introducing Payday Super.
- It protects workers. Under the old quarterly system, some employers fell behind on super payments. Some even failed to pay super at all. This left workers short changed. Payday Super reduces that risk because super is tied directly to each pay run.
- It helps retirement savings grow. Super paid more often means more time in the fund. More time in the fund means more investment growth. The government estimates workers could be tens of thousands of dollars better off over their working life.
For Melbourne employers, understanding this change early is key. The earlier a business prepares, the smoother the transition will be.
Key Dates Employers Need to Know
Here are the important dates to keep in mind. 1 July 2026 is the start date. From this day, all employers must pay super on payday. This applies to every business in Australia, including all Melbourne employers.
Businesses should start preparing well before this date. Most payroll experts recommend getting ready at least six months in advance. For those who have not started thinking about it yet, now is a good time to begin.
How Does Payday Super Work in Practice?
Here is a simple breakdown of how Payday Super works under the new system:
- Super Follows Every Pay Run: Super contributions must be sent to the employee’s fund every time payroll is processed, not at the end of the quarter.
- Tight Timeframe for Receipt: The super must be received by the employee’s super fund within a few days of each pay run.
- Rules Still Being Finalised: The ATO is still finalising some of the exact processing rules, but the timeframe is expected to be very tight.
- The Quarterly Buffer Is Gone: Under the old system, employers had up to 28 days after the end of each quarter to pay. That buffer is gone under Payday Super.
- Pay Cycle Sets the Super Cycle: If a business pays staff weekly, super goes out weekly. If the pay cycle is fortnightly, super goes out fortnightly. The pay cycle sets the super cycle.
What This Means for Melbourne Employers
For Melbourne business owners, here is what this change means day to day.
- Cash flow planning becomes more important: Super funds must be available every payday, not just four times a year. This means business cash flow needs to be tighter and better managed.
- Payroll software needs to be updated: Most modern payroll systems will be updated to handle Payday Super automatically. But employers need to check that their software is compliant before 1 July 2026.
- Manual payroll processes will not work well: Businesses still doing payroll by hand or using spreadsheets should consider upgrading. Payday Super will be very difficult to manage without the right software.
- Super fund relationships matter: Employers need to know which funds their employees use and be able to send payments to those funds quickly and easily. If a clearing house is used, it should be checked to confirm it can handle more frequent payments.
Steps to Get Payroll Ready
Here is a simple action plan for Melbourne employers.
Step 1: Review the current payroll setup.
Employers should look at how payroll is currently processed and how super is paid. Is it done in house? Is an accountant or bookkeeper involved? Is payroll software being used? Understanding the current situation is the first step.
Step 2: Check payroll software.
Employers should talk to their payroll software provider and ask if the system will be updated for Payday Super. Most of the major systems like Xero, MYOB, and QuickBooks will be updated. But it is always better to confirm directly.
Step 3: Review cash flow.
Employers should work out how much super is currently paid each quarter. Dividing that by the number of pay runs gives a rough figure of how much extra cash will be needed each payday. Businesses need to make sure they can handle that.
Step 4: Update employee super fund details.
Every employee’s super fund details should be checked and updated. This includes the fund name, the USI (Unique Superannuation Identifier), and the member number. Outdated or incorrect details will cause payment delays.
Step 5: Talk to an accountant.
Working with an accountant or bookkeeper means letting them know about the upcoming change. They can help plan for it and make sure systems are set up correctly. At Elite Plus Accounting, the team helps Melbourne businesses get their payroll ready for big changes like this one.
Step 6: Train the payroll team.
If someone else handles payroll, they need to know about the change. Giving them time to learn the new process before it goes live will make the transition much smoother.
Penalties for Non-Compliance
Here is what employers need to know about the consequences of missing super payments under the new system:
- Increased ATO Monitoring: The ATO will be keeping a close eye on super payments because super is now tied to every single pay run.
- Easier to Detect Late Payments: Late or missing payments will be much easier for the ATO to spot compared to the old quarterly system.
- Superannuation Guarantee Charge Applies: Under the Superannuation Guarantee Charge rules, employers who miss super payments face a charge that includes the unpaid super, interest, and an administration fee.
- No Business Deduction Allowed: These charges cannot be claimed as a business deduction, making them even more costly to the bottom line.
- Near Real Time Visibility: Under Payday Super, the ATO will have better visibility of payment timing in near real time. There is very little room to fall behind without being noticed.
- The Bottom Line: Super must be paid on time, every payday, from 1 July 2026 onwards.
Melbourne Employers: Stay Ahead of Payday Super
Payday Super is one of the most significant changes to hit Australian payroll in decades. From 1 July 2026, every business in Melbourne will need to pay super on payday, every single time wages go out. The quarterly system that most employers have relied on for years will no longer be compliant. Businesses that start preparing now, by reviewing their payroll setup, updating software, and planning cash flow, will be in a much stronger position when the deadline arrives.
The change does not have to be overwhelming. With the right systems and the right support in place, Payday Super is very manageable. The key is to act early rather than scramble at the last minute. For Melbourne employers who want to get their payroll ready and stay on the right side of compliance, the team at Elite Plus Accounting is here to help. Reach out today for a conversation about how the business can be prepared well ahead of 1 July 2026.
Frequently Asked Questions
What is the superannuation law in 2026?
From 1 July 2026, employers must pay superannuation on every payday instead of quarterly. This change, known as Payday Super, legally links super payments to each payroll run.
What are the changes to super in July 2026?
Super must be paid every payday, quarterly payments will no longer be allowed, and compliance monitoring will become near real-time. The reform changes payment timing, not contribution rates.
Is quarterly super still allowed?
No. From 1 July 2026, quarterly super payments will be non-compliant. All employers must move to payday-based super payments.
What happens if an employee's super fund details are not available before their first pay run?
Employers must still pay super on time using the default fund in their payroll system or workplace agreement. Missing fund details do not allow payment delays.
Will small businesses in Melbourne get extra support or transition time?
No. The law applies to all employers from 1 July 2026 with no delayed start for small businesses. Support will come through guidance, payroll software updates, and professional services, not extended deadlines.
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