Payroll used to have a quarterly rhythm: pay staff weekly, catch up on super every three months. That rhythm ended on 1 July 2026. Under Payday Super, super is due with every pay run, and the charge for getting it wrong starts accruing within days, not months. For employers who ran super out of whatever cash was left at quarter end, this is the biggest payroll change in years.
At the same time, wage underpayment is a serious legal risk, and the ATO sees every pay run through Single Touch Payroll. Payroll is now the part of the business where small errors are found fastest.
What does our payroll service include?
| Task | How often |
|---|---|
| Process pay runs in Xero (weekly, fortnightly or monthly) | Every pay cycle |
| Report each pay run to the ATO through Single Touch Payroll | Every pay cycle |
| Calculate and pay super so it reaches each fund within the Payday Super deadline | Every pay cycle |
| Leave accruals, timesheets, allowances, overtime and penalty rates | Every pay cycle |
| PAYG withholding reported on your BAS and reconciled to STP | Monthly or quarterly |
| Pay rate checks against the award | When we start, at each annual wage review, and on request |
| New employee onboarding pack | Each new hire |
| Terminations: final pay, unused leave, redundancy and tax on termination payments | As needed |
| STP finalisation for the year | By 14 July |
| Payroll tax and workers compensation declarations | As required by your state |
Weekly payroll for up to 10 staff is included in our Business Insights plan, alongside bookkeeping, BAS and monthly management reports.
How does Payday Super work from 1 July 2026?
The rules, for qualifying earnings paid from 1 July 2026:
- Rate: the super guarantee is 12% of qualifying earnings for 2026–27.
- What it's paid on: "qualifying earnings" replaced ordinary time earnings as the base. Most of what was ordinary time earnings still counts, and some items need checking, such as annual leave loading.
- When: the contribution must be received by the employee's fund within 7 business days after the day you pay the earnings.
- New employees and new funds: you have 20 business days for the first contribution to a new employee or a new fund.
- Business days exclude weekends and public holidays that apply across a whole state or territory.
- Out-of-cycle payments such as bonuses, commissions and back pay have their own extended timing rules.
- The maximum contribution base is now an annual figure: $270,830 of qualifying earnings per employee for 2026–27.
A worked example
Say you pay your staff on Thursday 5 November 2026. Counting 7 business days from the next day:
| Business day | Date |
|---|---|
| 1 | Friday 6 November |
| 2 | Monday 9 November |
| 3 | Tuesday 10 November |
| 4 | Wednesday 11 November |
| 5 | Thursday 12 November |
| 6 | Friday 13 November |
| 7 | Monday 16 November |
The super must be in the employee's fund by Monday 16 November. If your clearing house takes three business days to pass the money on, it needs to leave your account by around Tuesday 10 November. In practice, the safest habit is to pay super on the same day as wages.
For an employee earning $1,500 a week in qualifying earnings, that's $180 of super every week, due within 7 business days of each payday. Our Payday Super guide covers the rules in full.
Key point: The ATO has said that for the first year (paydays from 1 July 2026 to 30 June 2027) it won't focus compliance resources on employers who tried to pay on time and in full and fixed errors promptly. That's an administrative approach, not a change to the law. The charge still applies.
What happens if super is paid late?
The super guarantee charge was rebuilt for Payday Super. For each payday where super is short or late, the charge is made up of:
| Component | What it is |
|---|---|
| Final SG shortfall | The super that should have been paid, less any late contributions made before the ATO assessed you |
| Notional earnings | Interest on the shortfall at the general interest charge rate, compounding daily |
| Administrative uplift | Up to 60% of the shortfall plus notional earnings. Reduced if you make a voluntary disclosure before the ATO acts (most if you disclose quickly), and potentially to nil if you have a clean two-year record |
| Choice loading | Applies if you didn't follow the employee's choice of fund |
Two changes work in your favour: the new charge is tax deductible, and paying late (but before an assessment) reduces the shortfall. The interest on unpaid charge and the late payment penalty are not deductible.
Our super guarantee charge agent calculates the charge under both the old quarterly rules and Payday Super, works out the voluntary disclosure, and shows the cost of acting now versus waiting. An accountant reviews it before anything is lodged. For company directors, unpaid super can also lead to personal liability; see our guide to director penalty notices.
Are you paying staff the right award rates?
Most underpayments we find are not deliberate. They come from an employee classified at the wrong level, a penalty rate not set up for a public holiday, an allowance left off, or a rate not updated after the annual wage review on 1 July.
Our award underpayment audit agent checks each employee's pay against the award: classification, base rate, penalties, overtime, allowances and super. Where it finds a shortfall, it quantifies the back pay and the super that goes with it. A qualified person reviews every finding before you see it, and where a classification or legal question arises, we'll say so and involve an employment lawyer if needed.
If you've found or suspect underpayments across more than a few staff, our employment and award compliance service handles the full audit and remediation. Underpayment risk is highest in hospitality, retail, cleaning, and health and care services, where awards have many penalty rates.
What must a new employee receive?
Every new employee should get, before they start or as soon as possible after:
- the Fair Work Information Statement
- the Casual Employment Information Statement (casuals only, with repeat copies at set intervals) or the Fixed Term Contract Information Statement (fixed-term only)
- a super standard choice form, so they can nominate a fund. If they don't choose, you must request their stapled fund from the ATO before using your default fund
- instructions to complete their TFN declaration online, before their first pay
- a written offer letter or employment contract
Our new employee pack agent assembles the right documents for each type of employee with a cover email, and our offer letter agent drafts the offer with the right super, leave and probation terms. You check and send. Under Payday Super, collecting fund details before the first pay run matters more than ever, because the clock on the first contribution starts on the first payday.
What does STP finalisation involve?
At the end of each financial year you must make a finalisation declaration through STP. For most employees, the deadline is 14 July. Closely held payees (such as family members in a family business) have later dates. Finalisation tells the ATO the year's figures are complete, and it's what makes your employees' income statements "tax ready" in myGov.
We reconcile wages, PAYG withholding and super across the year to the BAS and the general ledger before finalising, so the numbers the ATO sees match your books.
Do you handle payroll tax and workers compensation?
Yes, as part of payroll. Payroll tax is a state tax with different thresholds and rates in each state and territory, and grouping rules can bring related businesses together. Our guide to payroll tax by state explains how it works. We prepare the monthly and annual returns where you're registered and calculate the wages declarations your workers compensation insurer needs.
What payroll mistakes do we see most often?
- Super still paid quarterly. Old habits are the biggest Payday Super risk. Every quarterly payment after 1 July 2026 is late for most of the paydays it covers.
- Fund details missing for new starters. Without a choice form or stapled fund, the first contribution can't go anywhere, and the 20-business-day window runs out.
- Pay rates not updated on 1 July. The annual wage review usually changes award rates from the first full pay period on or after 1 July.
- Contractors who are really employees. Our guide to employee vs contractor explains the tests.
- Leave loading and allowances set up wrongly. These affect both pay and the super base.
- BAS figures that don't match STP. W1 and W2 should agree with what payroll reported for the same period.
What does payroll cost?
Payroll is included in our Business Insights plan (from $249 per week + GST), which covers weekly payroll for up to 10 staff, plus bookkeeping, BAS lodgements, monthly management reports and the company tax return. Larger teams are quoted on headcount and pay frequency. See our pricing page.
If you have one or two employees on a simple award and you're comfortable in Xero payroll, running it yourself with a quarterly review from us is a perfectly good option. What we'd ask is that you pay super with each pay run, not later.
What should you send us?
- Employee list with start dates, employment type and award classification
- Your last two pay run reports and year-to-date payroll summary
- Super fund details for each employee and confirmations of super paid since 1 July 2026
- The award or enterprise agreement you apply
- Timesheets or roster data if hours vary
- Payroll tax and workers compensation registrations, if any
- Any back-pay or underpayment concerns you already know about
"I started using BPAG 3 years ago and they have been advising my business and myself in an extraordinary way. The team is also caring and they listen to what your needs are." Christian Luis Barbeitos Alvarez, Google review
Frequently asked questions
Does Payday Super apply to small businesses?
Yes. It applies to every employer, regardless of size, for qualifying earnings paid from 1 July 2026. Earnings paid up to 30 June 2026 stayed under the old quarterly rules, with the final quarter due on 28 July 2026.
Can I still use the Small Business Superannuation Clearing House?
No. The ATO's Small Business Superannuation Clearing House closed on 1 July 2026. You now need to pay through your payroll software or a commercial clearing house that meets SuperStream standards. Allow for its processing time, because the deadline is when the fund receives the money, not when you send it.
Do I have to pay super for contractors?
Sometimes. If a contractor is paid mainly for their labour under a contract, they can be treated as an employee for super purposes even with an ABN. The label on the invoice doesn't decide it. Our guide to employee vs contractor explains the tests.
What's the super guarantee rate for 2026–27?
12% of qualifying earnings. Super isn't payable on qualifying earnings above the maximum contribution base, which from 1 July 2026 is an annual figure of $270,830 per employee for 2026–27.
What happens if I made a payroll mistake in an earlier pay run?
Correct it in the next pay run or through an STP update event, and pay any super shortfall straight away. Under Payday Super, a late contribution paid before the ATO issues an assessment reduces the final shortfall, and a voluntary disclosure lodged quickly can reduce the administrative uplift. Don't wait for the ATO to find it.
Do I need payroll software if I only have one employee?
You need to report through Single Touch Payroll, so in practice yes, though there are low-cost and free STP options for micro employers. Xero payroll is included in most Xero plans. The bigger risk with one employee isn't the software, it's getting the award rate and super timing right.
Official sources
General information only, current as at 18 October 2026. It is not personal tax, legal or financial product advice and doesn't take your circumstances into account. Talk to us before you act. Where a recommendation needs a licensed financial adviser or a solicitor, we work alongside them.