Preparing for Payday Super – Xemplo Help

Audience: Xemplo Payroll Administrators and HR Managers

From 1 July 2026, the Australian Taxation Office (ATO) will introduce the Payday Super framework. As part of the Payday Super changes, Australian employers must pay superannuation guarantee (SG) contributions at the same time as salary and wages, rather than quarterly.

Find our more about Payday Super and it's impacts here: https://www.ato.gov.au/businesses-and-organisations/super-for-employers/payday-super/about-payday-super

To help you prepare, we are releasing this guide to changes required in Xemplo to meet Payday Super requirements. This article is intended for users of Xemplo's Payroll products (including third-party products), and outlines what you will need to look out for to ensure your organisation remains compliant. If you are a Managed Payroll customer, the Payroll Services team will complete this setup on your behalf.

This article will show you how to manage the following:

Prepare for the Payday Super transition

Before the 1 July 2026 effective date, Payroll Administrators should perform these payroll configuration audits to ensure your data is ready.

Review employee superannuation fund setup: Employees with incorrect or incomplete superannuation fund or product information entered will delay superannuation processing. You should export all employee superannuation information provided and validate that it is complete and valid. You can export worker superannuation information:
- From the Workers menu: Go to Workers > Download Reports, and select the Worker Details report
- From Payroll: Go to Employees, then select Export. The basic template report includes all required superannuation details.
Review Maximum Contribution Base (MCB) Overrides: Export your employee data to identify any employees with 'Custom' or 'Non-default' Quarterly MCB settings. You will need to review these for the new annual rules.
Identify Industrial Super: Audit your pay categories. Identify which ones pay super on overtime or other industrial super and apply the 'Exclude from QE' flag.
Check Under-18s: Identify employees under 18 who are on non-weekly pay cycles, as these will require manual QE verification in your payroll setup.

Categorise Qualifying Earnings (QE)

Under the new legislation, the Ordinary Time Earnings (OTE) model will be replaced by a new Qualifying Earnings (QE) framework. QE will be the official base used for calculating super guarantee obligations and will be reported to the ATO. Xemplo will determine QE status for a specific payment automatically where possible:

Automatic Classification: Any pay category with a Super Rate > 0% will automatically be classified as Qualifying Earnings.
Automatic Exclusion: Any pay category with a Super Rate of 0% will be excluded from QE.
The "Industrial Super" Exception: For scenarios where you pay super on overtime due to an Award or Enterprise Agreement, those earnings are not considered QE by the ATO. A new 'Exclude from qualifying earnings' checkbox has been added to each pay category. Ticking this will ensure the super is calculated but not reported as QE.

Transitioning to an Annual Maximum Contribution Base (MCB)

The current quarterly earnings cap is being abolished and will be replaced by a single Annual Cap of $270,830 starting 1 July 2026.

Automated Capping: Xemplo will track cumulative QE across the financial year. Once an employee reaches the threshold, Super Guarantee (SG) contributions will automatically stop, unless you adjust the threshold to pay above the legislated limit.
Dual Visibility: During the transition period, you will see both Quarterly MCB and Annual MCB fields in Pay Run Defaults and Pay Rate Templates screens.
Banner Warnings: We are adding clear banners to remind you that quarterly fields apply only to earnings processed before 1 July 2026.
Pay Run Logic: When an employee hits the cap, the system will display a note in the pay run: "The maximum annual super contributions base has been reached and SG amounts have been adjusted accordingly".

Review your superannuation setup

Before the 1 July 2026 effective date, Payroll Administrators should review their superannuation (clearing house) setup arrangements for suitability with Payday Super requirements.

To meet Payday Super requirements, a clearing house service must:

Provide near real-time payment options to allow payments to be made to a superannuation fund within the mandated 7-day period. Payment options like cheque, etc, risk missing payment deadlines when used.
Provide error reporting sufficient to quickly diagnose issues with returned payments to allow resubmission of payments to funds when payment information is updated.
Manage Member Verification Requests (MVR). A MVR is an automated SuperStream feature used to confirm if an employee's super details (name, TFN, DOB) match an active account and whether their fund can accept your contribution. MVRs help you catch errors before sending money, preventing rejected payments and penalties. Your chosen service should complete an MVR for all first-time contributions to a fund, or when a staff member changes super funds.

Xemplo provides and recommends using the Beam service for managing superannuation verification and payments. You can access the Beam service from the Payroll Settings > Superannuation setup screen of your payroll solution. Access to Beam is included as part of your Xemplo payroll subscription.

Pay Runs Splitting Financial Years

A critical aspect of the transition is the Date Paid Rule. The obligation is triggered by the actual date the payment is made, not the period in which the work was performed.

Scenario	Date Paid	Reporting Base	MCB Cap Applied	Super Payment Deadline
Work in June, Paid in June	Before 1 July 2026	OTE	Quarterly	28 July 2026
Work in June, Paid in July	On/After 1 July 2026	QE	Annual	7 Business Days from Payday
Work splits June/July, Paid in July	On/After 1 July 2026	QE	Annual	7 Business Days from Payday
Work splits June/July, Paid in June	Before 1 July 2026	OTE	Quarterly	28 July 2026

Important

If the Paid Date in your pay run is 1 July 2026 or later, the system will automatically apply the new Qualifying Earnings and Annual MCB logic, and your super contribution must reach the fund within 7 business days. Note: There are some exceptions to the 7-day deadline - see ATO: Payday Super.

Manage QE for employees under 18

Under Payday Super, the 30-hour weekly threshold for employees under 18 remains in effect. However, Payday Super requires specific QE reporting that can be complex for non-weekly pay runs:

Weekly Pay Runs: The system will automatically determine if the 30-hour threshold was met.
Non-Weekly Pay Runs (Fortnightly/Monthly): A new QE Override Field has been introduced on the pay run management screen. You will be able to manually enter the correct QE figure for these employees to ensure your STP reporting remains compliant with the new Payday Super requirements.

Managing super payments for contractors

Payday Super requires employers to pay super for eligible contractors within 7 business days of payday, matching the pay cycle rather than quarterly. Contractors paid mainly for personal labor or skills are considered employees for superannuation guarantee (SG) purposes, a rule that remains unchanged but becomes strictly enforced.

Key Implications for Contractors and Payday Super (from 1 July 2026)

Definition Unchanged: If you currently have to pay super for a contractor, you will continue to do so. The rules regarding who is a "deemed employee" (wholly/principally for labor) are not changing.
Stricter Timing: Super must be paid on or before the day you pay their invoice, reaching their fund within 7 business days.
No Out-of-Cycle Extension: Unlike some employee payments, payments to contractors will not qualify for an extension, meaning super must be paid immediately with the invoice.

For help determining eligibility, see the ATO: Determining contractor eligibility guide.

Reporting & Technical Updates

Report Renaming: The existing OTE Report has been renamed to the OTE/QE Report. A new QE column will be added for all pay runs paid on or after 1 July 2026.
New STP Codes: STP submissions for pay runs dated 1 July 2026 onwards will automatically include both Code Q (Qualifying Earnings) and Code L (Super Liability).