Overview
The Australian Taxation Office (ATO) has published Law Companion Ruling LCR 2026/2, which explains the rules around eligible contributions under the Payday Super system. The ruling is administratively binding on the ATO Commissioner and applies from 1 July 2026.
Payday Super was introduced by the Treasury Laws Amendment (Payday Superannuation) Act 2025 and the Superannuation Guarantee Charge Amendment Act 2025.
What Payday Super Requires
Under Payday Super, superannuation contributions are required to be made per pay run rather than quarterly. Quarterly contributions are no longer sufficient from 1 July 2026.
What Counts as an Eligible Contribution
An eligible contribution is one that can reduce or eliminate a Superannuation Guarantee (SG) charge. To qualify, a payment must meet both of the following conditions:
- It is made to a complying superannuation fund or a Retirement Savings Account (RSA).
- It is able to be allocated to the employee's account.
On-Time and Late Contributions
The ruling covers on-time contributions as well as late contributions. It also covers allowable longer periods, which apply in the following circumstances:
- New employees
- Out-of-cycle payments
- Exceptional circumstances
- A bunching rule
Confirming a Fund's Complying Status
The ruling sets out how a fund's complying status is confirmed. Employers are required to obtain a written statement from the fund trustee, obtained at or before the time the contribution is made. The statement must confirm:
- The fund is a resident regulated superannuation fund; and
- The fund is not subject to a direction preventing employer contributions.
This written statement is required to claim the complying fund presumption under LCR 2026/2.
Key Actions
- Check that superannuation payments are being made per pay run under Payday Super, which commenced on 1 July 2026 - quarterly contributions are no longer sufficient.
- Before making super contributions to any fund, obtain a written statement from the fund's trustee at or before the time of payment, confirming the fund is a resident regulated superannuation fund and is not subject to a direction preventing employer contributions.
- Read the full ruling at https://www.ato.gov.au/law/view/document?docid=COG/LCR20262/NAT/ATO/00001 and the companion ruling LCR 2026/3, which covers how the SG charge is calculated and how eligible contributions reduce any charge that may be owed.
- Talk to your bookkeeper, payroll provider, or accountant about how your payroll system is handling the new Payday Super timing requirements, including allowable longer periods for new employees and out-of-cycle payments.
This is a plain-English summary for information only, not legal or compliance advice. Always check the official source or consult a qualified professional.