What’s changing:
- From 1 July 2026, employers must pay superannuation guarantee contributions at the same time as salary and wages, rather than paying superannuation quarterly.
- Superannuation guarantee contributions must be received by the employee’s superfund within 7 business days of payday, to avoid being liable for the punitive superannuation guarantee charge.
Implications for your business:
- Cash flow management will become more important, as super payments will need to be processed with each pay cycle – whether that is weekly, fortnightly or monthly.
- You will need to ensure your payroll system is capable of handling real time superannuation guarantee payments alongside wages. Accounting software programs like Xero, MYOB and QuickBooks have this functionality, although it can take a few days for the payment to be processed and received by the employee’s fund.
- If you are currently using the ATO Small Business Superannuation Clearing House, you’ll need to upgrade your payroll software to be able to handle superannuation payments directly, as the ATO are closing down the SBSCH from 30 June 2026.
The Payday superannuation rules are now law, so employers need to ensure they are ready to comply prior to 30 June 2026.
Division 296 Tax: New Rules for High-Balance Super Accounts
The proposed Division 296 tax still targets individuals with super balances over $3 million, however there have been some substantial changes to the original proposal:
- The government has removed the proposed tax on unrealised gains, but will be applying an additional 15% tax to earnings attributable to balances over $3M (potentially taking the effective tax rate to 30%).
- A second threshold of $10 million has been introduced, with a further 10% tax to earnings attributable to balances over $10M (potentially taking the effective tax rate to 40%).
- Both thresholds will be indexed to CPI.
- The start date has been deferred to 1 July 2026.