It is a director’s problem.
From 1 July 2026, the way Australian employers pay superannuation changed significantly. Under Payday Super, super guarantee contributions must now be paid with every pay run rather than quarterly, and the employee’s super fund must receive contributions within seven business days of payday.
If you have not yet reviewed how these changes affect your payroll obligations, our guide, “What employers need to know about Payday Super,” covers the operational details. This article focuses on something most employer-directors are unaware of until it is too late: what happens when a payment is missed, and when it stops being a company problem and becomes a personal one.
What changed from 1 July 2026
Under the old system, employers had until the 28th day of the month following each quarter to pay super. Under Payday Super, contributions must be paid every time you pay your employees and must be received by the fund within 7 business days of payday.
There are a few important details worth understanding clearly.
Payment initiation is not the test. The contribution must actually be received by the employee’s super fund within the seven-business-day window, with sufficient information to allocate it to the correct member account.
Qualifying Earnings is the new term for the earnings base used to calculate super contributions. It replaces Ordinary Time Earnings and is largely the same, with one notable difference: all commissions paid to an employee are now included in Qualifying Earnings, including commissions for work performed entirely outside ordinary hours. If you pay commissions to your team, it is worth confirming your payroll calculation is correct.
From 1 July 2026, the Maximum Contributions Base is set at $250,000 per annum. This creates a maximum Superannuation Guarantee (SG) liability of $30,000 per employee each financial year. Once an employee’s earnings reach that threshold, SG contributions can cease for the remainder of the year.
The Small Business Superannuation Clearing House closed permanently on 30 June 2026. If you were using the SBSCH to process super contributions, you should have already moved to an alternative SuperStream-compliant clearing house. If this has not been addressed, it requires immediate resolution.
Voluntary Disclosure Statements
If you miss a contribution and have not yet received a notice of assessment, you can lodge a Voluntary Disclosure Statement with the ATO. This can reduce the amount of SGC you are liable to pay. A VDS can only be lodged before an assessment is issued, so timing is crucial.
Under Payday Super, the VDS is the voluntary disclosure mechanism available to employers who identify a problem and wish to address it proactively. The practical advice is straightforward: pay the fund and lodge a VDS early. Delaying moves you closer to a position where those options are no longer available.
How the ATO is approaching compliance
The ATO has published its compliance approach for the first year of Payday Super under PCG 2026/1. The ATO is focusing its resources on high-risk employers and will take a supportive approach toward employers who pay super on each payday and correct errors as soon as they become aware of them.
This does not mean errors will be ignored. Rather, the ATO is prioritising wilful or repeated non-compliance over genuine transitional errors. If you identify a problem, the correct response is still to fix it immediately, rather than relying on the transitional approach as a reason to delay. This leniency ends on 1 July 2027.
When a Missed Payment Becomes a Director’s Personal Problem
When a company has an unpaid SGC liability that remains outstanding after the due date, the ATO can issue a Director Penalty Notice (DPN) to each director of the company. A DPN creates personal liability: each director is personally liable for the unpaid SGC. This liability runs parallel to the company’s; a payment by either the company or a director reduces both.
The DPN regime for SGC operates alongside the same regime that applies to unpaid PAYG withholding and GST. The ATO is clear that directors need to ensure SGC is paid in full by the due date, or personal liability will follow.
Once a DPN is issued, directors have 21 days to act. The 21-day window runs from the date the notice is issued by the ATO, not from the date it is received. Keeping your ASIC registered address current is therefore important – a DPN delivered to an old address still starts the 21-day clock.
Within that window, the penalty may be remitted if the company pays the SGC in full, enters voluntary administration, appoints a small business restructuring practitioner, or is wound up. Once that window closes without action, the options narrow significantly, and full payment is typically the only available remedy.
Under Payday Super, the exposure crystallises per payday rather than per quarter. Under the old system, a missed quarterly payment created one SGC liability. Under Payday Super, missing contributions across multiple paydays creates multiple SGC liabilities – each of which can give rise to a director penalty.
What Australian employers should review now
If you haven’t already, the following areas are worth reviewing with your payroll team or advisor.
Payroll system timing. Does your payroll system initiate super payments at the same time as wages are paid? Initiating payment isn’t sufficient – the fund must receive contributions within seven business days. Confirm that your payroll provider is SuperStream-compliant and has been tested for Payday Super processing.
Employee fund details. Incorrect or outdated fund details are one of the most common causes of failed or returned contributions. Verify that employee super fund information is current and complete, including valid Electronic Service Addresses for any employees with SMSFs.
Qualifying Earnings calculations. If your payroll software is calculating super on Ordinary Time Earnings rather than Qualifying Earnings, contributions may be systematically underpaid across every payday – creating ongoing SGC exposure without the business being aware of it.
Error correction procedures. Does your team have a clear process for quickly identifying and correcting super payment errors? Under Payday Super, the speed of correction determines whether a Voluntary Disclosure Statement is still available and whether a director penalty remains remittable within the 21-day window.
How Optima Partners can help
If you are unsure whether your payroll and super obligations are being met correctly under Payday Super, now is the right time to review them. The consequences of getting it wrong are significantly more serious than under the old quarterly system, and they can extend not only to the company but also to you personally as a director.
Our Business Advisory and Taxation Services teams work with Australian employers across all of this, from payroll compliance and superannuation obligations to director risk management. Get in touch with us now.
