Overview
The Australian Taxation Office (ATO) has published Law Companion Ruling LCR 2026/3, which explains how the superannuation guarantee (SG) charge is calculated and assessed under the Payday Super rules. The ruling is administratively binding on the ATO Commissioner, meaning the ATO is required to follow it.
What is Payday Super?
Payday Super applies from 1 July 2026. It was introduced by the Treasury Laws Amendment (Payday Superannuation) Act 2025 and the Superannuation Guarantee Charge Amendment Act 2025.
Under Payday Super, each day an employer pays qualifying earnings to an employee becomes a 'QE day'. Super contributions are required to be made on time for each QE day. If contributions are not made on time, a charge applies.
What LCR 2026/3 Covers
The ruling addresses the following aspects of the SG charge under Payday Super:
- SG shortfall calculation - how the shortfall is calculated per employee per QE day.
- Administrative uplift penalty - how this penalty works, including reductions available for voluntary disclosure and good compliance history.
- Choice loading - how a penalty applies when contributions are made to the wrong fund.
- Assessment and amendment - how the ATO assesses and amends SG charge liabilities.
Key Actions Stated in the Ruling
- Payday Super applies from 1 July 2026. Payroll systems are required to ensure super contributions are made on each payday (each QE day), not just quarterly.
- The full ruling is available at https://www.ato.gov.au/law/view/document?docid=COG/LCR20263/NAT/ATO/00001 and sets out exactly how the SG shortfall and charge are calculated per employee per pay cycle.
- Super contributions are required to go to the correct fund for each employee. The ruling confirms a choice loading penalty applies when contributions are made to the wrong fund.
- Where an existing SG shortfall exists, a voluntary disclosure statement can be made to the ATO. The ruling confirms this can reduce the administrative uplift component of the SG charge.
- The ATO has also published LCR 2026/3EC as the compendium for this ruling, which provides further guidance on other aspects of the Payday Super reforms.
This is a plain-English summary for information only, not legal or compliance advice. Always check the official source or consult a qualified professional.