Posted on by Wunsch & Co

PAYDAY SUPER

If you run a small or medium business, now is the time to start preparing. The earlier you review your payroll and super processes, the easier the transition will be.

What is Payday Super?

 

Under the current rules, employers generally pay employees’ super at least quarterly. With Payday Super, super contributions will need to be processed much more frequently, typically alongside each pay run.

 

This means businesses will need to:

    • Calculate super correctly every pay cycle
    • Process super payments on time
    • Make sure payroll systems are set up properly
    • Keep enough cash flow available to cover wages and super together

 

For many businesses, this will be a significant process change rather than just an admin update.

Why this matters to employers

 

Payday Super will affect more than payroll timing. It can also impact:

    • Cash flow management
    • Payroll procedures
    • Software setup
    • Record keeping
    • Employee onboarding
    • Super clearing house processes

 

If your business is used to paying super quarterly, moving to a pay-cycle model may require better planning and tighter controls

How to Get Ready for Payday Super

 

  1. Review Your Current Payroll Process

Look at how payroll is currently handled:

    • How often do you run payroll?
    • Who is responsible for processing super?
    • Is the super calculated automatically?
    • Are there any manual workarounds?
    • Do you rely on reminders for quarterly deadlines?

 

  1. Check Your Cash Flow

 

One of the biggest changes will be timing. Instead of keeping super funds in the business until the quarterly due date, you may need to pay them much sooner.

To prepare:

    • Update your cash flow forecasts
    • Include super in each pay cycle
    • Review working capital needs
    • Make sure funds are available on payday

 

This is especially important for seasonal businesses or businesses with tight margins.

 

  1. Confirm Employee and Super Fund Details

Incorrect employee information can delay super payments and create compliance issues.

Cleaning up this data now can prevent processing issues later.

 

  1. Review of Your Payroll Software

Your payroll software will play a major role in managing Payday Super. You should confirm:

    • Whether your software supports more frequent super processing
    • How is super reported and paid
    • Whether integration with a clearing house is available
    • Whether updates will be required before the rules commence

If you use cloud software such as Xero, MYOB or QuickBooks, this should be easy to update to Pay Day Super.

 

  1. Update Internal Procedures

Document how your team will handle the new process. This may include:

    1. payroll cut-off times
    2. approval processes
    3. payment authorisations
    4. reconciliation procedures
    5. handling failed or rejected super payments

 

For Example:
How to Prepare for Payday Super in Xero

 

Step 1: Review Employee Super Settings

   In Xero Payroll, check each employee record to make sure:

    1. Super fund details are entered correctly
    2. Contribution rates are correct
    3. Ordinary time earnings categories are set up properly
    4. Employee commencement and fund choice details are complete

 

Step 2: Check Pay Items and Earnings Categories

   Review your pay items to ensure super is being applied correctly. For example:

    1. Ordinary hours usually attract super
    2. Some allowances may or may not attract super
    3. Overtime may be treated differently depending on the rules

 

Step 3: Check How Super Payments Are Processed

If you use Xero’s super payment functionality, review:

    1. How payments are submitted
    2. How long does processing take
    3. Who approves payments

 

Step 4: Build Super Into Each Pay Run Workflow

 Treat Super as part of the normal payroll cycle. For example, your new workflow might be:

How we can help:

    • reviewing your payroll setup
    • checking super calculations
    • helping forecast cash flow impacts
    • cleaning up employee and super data
    • advising on software processes
    • identifying compliance risks before the change starts

 

If you would like help reviewing your payroll system, cash flow or super processes, our team can help you get ready for Payday Super and ensure your business is set up correctly.


For more information click ATO’s Payday Super Resources
or contact our friendly & ready-to-assist team at Wunsch & Co