The bill amends the Superannuation Guarantee Charge Act 1992 and the Superannuation Guarantee (Administration) Act 1992 to require employers to pay superannuation guarantee (SG) contributions each payday instead of quarterly, and to strengthen penalties and incentives to ensure on-time payment.
Under the new “payday superannuation” framework, contributions must be received by the employee’s fund within seven business days of each qualifying earnings day (with extended timeframes in certain cases), late shortfalls attract daily notional earnings and an administrative uplift, and new choice-of-fund and late-payment penalties apply. The changes take effect 1 July 2026.
The Treasury Laws Amendment (Payday Superannuation) Bill 2025 and the Superannuation Guarantee Charge Amendment Bill 2025 overhaul the timing and enforcement of the superannuation guarantee (SG) under the Superannuation Guarantee (Administration) Act 1992 (SGA Act) and the Superannuation Guarantee Charge Act 1992 (SGC Act). Employers will calculate an individual SG amount on each “QE day” (the day qualifying earnings are paid) and must ensure contributions to a complying fund or RSA are received within seven business days (the “usual period”). For first payments to a new employee, changes of fund, out-of-cycle payments or exceptional circumstances, the due date extends to 20 business days. Contributions after the usual period reduce the “individual final SG shortfall” but accrue daily notional earnings until paid or assessed. A scalable administrative uplift (initially 60% of shortfalls plus notional earnings) replaces the previous fixed administration component and may be reduced by voluntary disclosure. Contributions in breach of choice-of-fund rules incur a 25% “choice loading,” capped per notice period. SG charge assessments can be made at any time, with general interest charge applying to the entire unpaid amount. Unpaid SG charge after 28 days triggers written notices and tiered penalties of 25% or 50% of the outstanding balance. The measures commence on 1 July 2026.
This reform aligns superannuation contributions with when employees actually earn their pay, reducing the risk of unpaid or delayed SG and protecting retirement savings. By requiring contributions within seven business days (or extended periods in limited cases) and applying daily notional earnings on any shortfall, it ensures workers do not lose out on compound returns—maximising overall well-being and minimising harm to future retirees.
The scalable administrative uplift and voluntary disclosure provisions incentivise employers to promptly self-correct underpayments, lowering compliance costs for taxpayers. The choice-of-fund safeguard and updated penalty regime promote fairness by ensuring all employees receive their entitlements on time, reducing inequality in retirement outcomes and strengthening trust in the system. [Judgment]
While the goal of timely superannuation is commendable, shifting from quarterly to payday contributions imposes significant transitional and ongoing compliance costs on employers and payroll software providers. Large-scale IT upgrades, payroll recalibrations and extended record-keeping may disproportionately burden small and medium enterprises, potentially leading to higher prices for consumers or reduced hiring. [Judgment]
The daily accrual of notional earnings and the new administrative uplift create intricate calculations that risk penalising inadvertent errors, which could deter smaller employers from offering additional benefits or engaging casual staff. A simpler enforcement of quarterly obligations may achieve similar compliance outcomes with far lower administrative overhead. [Judgment]
2025-10-09
House of Representatives
Before House of Representatives
Unspecified
Treasury
Labour, Financial Regulation, Taxation