- The super guarantee rate is 12% of ordinary time earnings from 1 July 2025.
- Payday Super requires employers to pay super on each payday from 1 July 2026.
- Late or short super triggers a Super Guarantee Charge (SGC), which the ATO calculates and assesses.
Understanding your superannuation guarantee employer obligations is now more important than ever for Australian businesses. The super guarantee rate sits at 12%, and from 1 July 2026 the Payday Super changed the timeframe within which contributions must reach your workers’ super funds.
Getting these employer super obligations right protects your staff and keeps you clear of costly penalties. This guide walks through the current rate, who you must pay, how much to calculate, when payment is due, and what happens if you fall behind, all based on current ATO rules.
What is the superannuation guarantee rate in 2026?
The superannuation guarantee rate is 12% of an eligible worker’s ordinary time earnings, and this level has applied since 1 July 2025. It was the final step in a series of legislated increases, so the rate is not scheduled to rise again on the current timetable. Eligible workers attract the same 12% Super Guarantee rate regardless of industry or business size.
This means your budgeting can now treat 12% as a stable input rather than a moving target. The bigger change for 2026-27 is not the rate itself, but how and when you must pay it.
What are your super obligations as an employer?
Your core super obligation is to pay the correct super guarantee amount for every eligible worker, on time, into a complying fund. Several administrative duties sit alongside that headline requirement, and each one carries its own compliance risk if handled poorly.
- Offer eligible employees a choice of super fund, and request stapled fund details from the ATO when a new starter makes no choice.
- Pay super through the SuperStream system so contributions and payment data travel electronically to the fund.
- Report super through Single Touch Payroll every time you run a pay cycle.
- Keep clear records of contributions, ordinary time earnings, and fund details for each worker.
Many growing businesses lean on external payroll providers to manage these moving parts accurately, especially once headcount climbs. The goal is a repeatable process where super is never an afterthought at pay time.
TIPSchedule your super payments to clear well before each deadline. Because funds can take several days to process a contribution, paying on payday itself is the safest way to meet the new rules.
Who do you have to pay super for?
You must pay super for your employees and, importantly, for many contractors too. The old $450 per calendar month earnings threshold was removed on 1 July 2022, so most eligible workers now qualify from their very first dollar of ordinary time earnings.
Employees are the obvious group, but the rules reach further than many owners expect. The key test is the nature of the working relationship, not simply the label on a contract.
Contractors paid mainly for labour
A contractor who works under a contract that is wholly or principally for their labour is treated as an employee for super purposes. This applies even where they quote an Australian business number, and regardless of how much they earn in a month. You calculate super on the labour component of their invoice rather than materials or subcontracted work.
A sole trader who takes on employees can face the same duties the moment a worker or contractor meets these tests. When in doubt, it is safer to assess the relationship carefully than to assume no super is owed.
How much super do you pay, and how is it calculated?
You pay 12% of each worker’s ordinary time earnings for the relevant period. Ordinary time earnings capture what a worker earns for their normal hours, which is broader than base salary alone.
What counts as ordinary time earnings?
- Ordinary hours of work, including over-award payments.
- Shift loadings and many allowances.
- Commissions and certain bonuses tied to ordinary hours.
- Paid leave such as annual leave and personal leave.
- Overtime is generally excluded where hours are clearly separated.
There is also an upper limit. The maximum contributions base caps the earnings on which you must pay super in a financial year. For 2026-27 this base is $270,830, calculated from the $32,500 concessional contributions cap divided by the 12% rate and rounded down to the nearest $10. Once a worker’s qualifying earnings reach that level, you can stop paying the minimum super for them for the rest of the year.
Payments such as directors fees can also attract super, so treat them deliberately rather than lumping them in with dividends or drawings. Running the calculation on the correct earnings base is the single best way to avoid a shortfall.
When do you pay super now? Payday Super explained
You now pay super on each payday rather than each quarter. Since 1 July 2026, Payday Super requires your contributions to reach each worker’s fund within seven business days of the day you pay their qualifying earnings.
This is a significant operational shift from the old quarterly model. The table below sets out what changed and what you must now do differently.
| Feature | Quarterly super (before 1 July 2026) | Payday Super (now, from 1 July 2026) |
|---|---|---|
| Payment frequency | Four times a year against quarterly due dates | On every payday |
| Deadline | 28 days after the end of each quarter | Contribution received by the fund within 7 business days of payday |
| What employers must do | Batch super each quarter and reconcile later | Align super with every pay run and confirm the fund receives it |
| Missing a payment | Lodge a super guarantee statement, then pay the charge | ATO calculates and assesses the new charge automatically |
Figures in this table are current as at 22 July 2026. In practice, the cleanest approach is to fund super at the same moment you process wages, leaving a comfortable buffer before the seven day window closes.
What happens if you pay super late or short?
Paying super late or short makes you liable for the super guarantee charge, even when you are only a few days behind. Under Payday Super the ATO calculates and assesses this charge for you, so you no longer lodge a separate super guarantee statement for missed amounts.
The charge is built from four components for each payday:
- the individual final super guarantee shortfall, being the unpaid super for each worker
- notional earnings, which is interest on the shortfall compounded daily
- an administrative uplift, initially 60% of your total shortfall and notional earnings
- a choice loading of 25% where you did not follow the choice of fund rules, capped at $1,200 per notice period
Unlike the old regime, the super guarantee charge for paydays from 1 July 2026 is generally tax deductible across its four components. However, late payment penalties and interest on an unpaid charge remain non-deductible, so acting quickly still pays off. For a fuller walk through of missed payments, this late superannuation explainer covers the recovery steps in detail.
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Frequently Asked Questions
Is superannuation paid on overtime?
Overtime is generally not part of ordinary time earnings, so you usually do not pay super on it. Some annualised salary and shift arrangements can blur the line between ordinary hours and overtime. Where the hours cannot be clearly separated, the ATO may treat the whole amount as ordinary time earnings.
Do I pay super for employees under 18?
Workers under 18 are entitled to super once they work more than 30 hours in a single week for you. Below that threshold, you generally do not pay super for them. This is one of the few hours-based tests that survived the removal of the $450 monthly floor.
What is a stapled super fund?
A stapled fund is an existing super account that is linked to a worker and follows them between jobs. If a new starter does not choose a fund, you must request their stapled fund details from the ATO before defaulting them into your own fund. This rule exists to stop workers from accumulating multiple accounts and duplicate fees.
Can I pay super more often than each payday?
Paying super more frequently than each payday is completely acceptable, and many employers already run weekly or fortnightly contributions. Paying early never counts against you under the rules. What matters is that the contribution reaches the fund inside the required window.
Does super apply to bonuses and commissions?
Bonuses and commissions tied to a worker’s ordinary hours usually count as ordinary time earnings and attract super. A purely discretionary bonus with no link to ordinary performance may sometimes sit outside that base. Documenting the reason for each payment helps you apply the correct treatment consistently.
What happens if a contractor has no ABN?
If a contractor cannot supply an Australian business number, you may need to withhold 47% from their payment under the no-ABN withholding rule. That withholding is separate from super, which can still apply where the contract is mainly for their labour. Always check both obligations before you release payment.
Is the super guarantee charge different from ordinary super?
The super guarantee charge is a penalty applied when you miss or underpay super, and it is paid to the ATO rather than the fund. Since 1 July 2026 it is calculated on the same qualifying earnings base as ordinary super, but it adds notional earnings and an administrative uplift on top of the unpaid amount. Those extra components make the charge far more expensive than simply paying super correctly and on time.
