As part of the 2023-24 Budget, the Commonwealth Government announced that from 1 July 2026, subject to the passage of legislation, employers will be required to pay their employees’ superannuation guarantee (SG) entitlements on the same day that they pay salary and wages.

Treasury has released the Securing Australians’ Superannuation consultation paper setting out options to implement payday superannuation.

There are two models that could be used. An ‘employer payment’ model that would impose the requirement on the employer to make payment of the SG contributions on the day that wages and salary is made or a ‘due date’ model that requires contributions to be received by the superannuation fund within a certain number of days following ‘payday’

The Superannuation Guarantee rate is currently 11 per cent of an employee’s ordinary time earnings and is legislated to rise in increments of 0.5 percentage points each year until it reaches 12 per cent on 1 July 2025.

Due to the current design of the SG system (including the frequency with which employers are required to pay SG, the operation of the SG charge, and limitations with the ATO’s IT capabilities to identify unpaid SG), many SG obligations remain unpaid for extended periods of time. This causes significant issues when employers enter liquidation without having paid their SG obligations.

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