The Federal Government's Payday Super reforms represent one of the most significant changes to superannuation guarantee compliance in recent years. From 1 July 2026, employers will be required to pay SG contributions at the same time as ordinary time earnings — shifting from a quarterly payment cycle to a near-real-time obligation aligned with each pay event.
For insolvency practitioners, understanding these changes is important both for appointments already in progress and those that may arise after the commencement date. The reforms affect how SGC liabilities accrue, how they are quantified, and how they interact with existing priority and penalty frameworks.
How the Obligation Changes
Under the current framework, an employer's SG obligation arises on a quarterly basis. If contributions are not made by the quarterly due date, the employer becomes liable for the superannuation guarantee charge (SGC) — which includes the shortfall, nominal interest, and an administration fee — reported and remitted to the ATO via an SGC statement.
From 1 July 2026, the obligation will arise with each pay event. Contributions must be received by the employee's superannuation fund within a short window after each payment of ordinary time earnings — currently proposed at seven calendar days. Failure to meet this deadline will trigger an SGC liability on a per-payrun basis rather than quarterly.
Implications for External Administrations
The shift to payday super changes the character and timing of SGC liabilities in several ways relevant to practitioners.
- Accrual and quantification — For administrations covering periods that span both sides of 1 July 2026, SGC reconstruction will require two methodologies: quarterly-basis analysis for pre-reform periods and a per-payrun analysis for post-reform periods. Entities with poor payroll records will require more granular reconstruction work after the commencement date.
- Priority waterfall under s.556 — SGC debts retain their statutory priority treatment under the Corporations Act. The more frequent accrual of these debts post-Payday Super may affect the quantum and timing of priority claims, particularly in administrations that commence shortly after 1 July 2026 where the full prior-quarter SGC cycle will not yet have elapsed.
- Director penalty exposure — Director penalty notices in respect of SGC obligations remain available to the ATO. The per-payrun accrual under Payday Super may compress the window between the trigger event and the point at which directors become personally exposed, particularly for entities experiencing ongoing cash-flow difficulty prior to appointment.
- ATO payment arrangements — Practitioners should review whether any existing ATO payment arrangements distinguish between pre- and post-reform SGC liabilities, and whether the terms of those arrangements remain appropriate in the context of the new accrual basis.
Practical Steps for Practitioners
For appointments commencing after 1 July 2026, practitioners should consider the following as part of their initial engagement steps.
- Obtain payroll records to the date of the last completed pay event, not just the most recent quarter end, to establish a precise opening SGC liability position.
- Confirm whether SG contributions were cleared to the relevant superannuation funds for each pay event in the period leading up to appointment, as partial payment patterns will be more granular under the new framework.
- Assess director penalty exposure on a per-payrun basis for the post-reform period, distinguishing between lockdown and non-lockdown debts where applicable.
- Where payroll records are incomplete or unreliable, engage a specialist to reconstruct the SGC position using available bank data, payroll software exports, and ATO prefill data.
A Note on Pre-Reform Appointments
For administrations already underway that will not yet have resolved by 1 July 2026, the quarterly-basis SGC framework continues to apply to all pre-commencement periods. Practitioners should not anticipate any retrospective change to how existing SGC liabilities are calculated or reported — the new obligations apply prospectively from the commencement date only.
That said, if the administration extends into the post-reform period and the entity is still operating (for example, in a trading administration or a restructuring scenario), real-time SG compliance obligations will apply to any wages paid after 1 July 2026.