Payday Super: Legislation Introduced and ATO Guidance Released

The Australian Government has taken another significant step towards improving employee superannuation outcomes. On 9 October 2025, bills were introduced to Parliament which, if passed, will require employers to pay superannuation guarantee (SG) at the same time as salary and wages — a change that is set to commence from 1 July 2026.

At the same time, the Australian Taxation Office (ATO) released a Practical Compliance Guideline (PCG 2025/D5) for consultation, outlining its proposed compliance approach for the first-year post implementation.

This note summarises what’s changing, what it means for employers, and how Bentleys can help your business prepare.

At a glance

1. Legislative Update

On 9 October 2025, the Government introduced two key bills:

• Treasury Laws Amendment (Payday Superannuation) Bill 2025
• Superannuation Guarantee Charge Amendment Bill 2025

If passed, from 1 July 2026 employers must pay SG contributions at the same time as salary and wages.

Employers will be liable for the superannuation guarantee charge (SGC) unless contributions are received by the fund within seven business days of each payday (a welcome change from the seven calendar days proposed in the draft legislation).

This is a significant change from the current quarterly system and represents a major shift in employer compliance obligations and cashflow management.

2. ATO Guidance

To assist employers with the transition, the ATO released PCG 2025/D5 for consultation.

This Practical Compliance Guideline outlines the ATO’s proposed compliance approach for the first year after commencement.
The guideline signals a pragmatic approach to enforcement, with the ATO likely to focus on education and assistance rather than immediate penalties — provided employers make genuine efforts to comply.

The ATO will have increased visibility in relation to superannuation compliance as a result of these reforms and is expected to be more proactive with data matching.

3. Implementation Considerations

Businesses will need to consider the following before July 2026:

• Payroll system configuration: Ensure your payroll software can automatically calculate and remit SG at each pay cycle.
• Cashflow management: More frequent SG payments will tighten cashflow cycles — forecasting and liquidity planning will be essential.
• Process changes: Payroll, finance, and HR teams should review processes to ensure accuracy and timely remittance.
• Employee communication: Be ready to explain the change to staff and answer questions.

4. Software Provider Readiness

The Government has indicated that it is working closely with major payroll and accounting software providers to support a smooth transition.

Most reputable software providers are expected to roll out system updates and automation functionality before the 1 July 2026 deadline.

As part of the Payday Super reforms, the Small Business Superannuation Clearing House (SBSCH) will close from 1 July 2026.

Employers currently using the SBSCH should transition to a payroll or accounting platform that automates SG payments ahead of this change.

Businesses should engage early with their software providers to confirm release timelines, migration options, and configuration support.

5. Preparing Your Business

Bentleys recommends that employers:

• Review payroll processes now. This includes onboarding processes to ensure the correct information is collected upfront to ensure no delays in superannuation payments.
• Model the potential cashflow impacts of more frequent SG payments.
• Monitor ATO updates and finalisation of PCG 2025/D5 to understand the compliance expectations for 2026–27.
• Ensure you keep up to date with correspondence from your payroll software provider ahead of this change.

Bentleys is ready to support you to improve your payroll and superannuation governance. Being proactive will ensure your business avoids penalties and administrative strain.