Payday Super – ATO finalises first year compliance approach

The PCG confirms that the ATO will take a facilitative approach for employers demonstrating genuine efforts to comply, while still placing strong emphasis on data quality, payment timeliness and internal control frameworks.

At the same time, several broader implementation issues remain uncertain, including potential inadvertent breaches of concessional contribution caps during the transition, and pay‑cycle scenarios that may unintentionally trigger overpayment of Superannuation Guarantee (SG). These are areas where employers need to proceed carefully, and where further legislative refinement may still occur.

PCG 2026/1 – ATO’s first‑year compliance intent

Under PCG 2026/1, the ATO’s compliance focus will centre on three risk categories:

• Low risk – Employers who pay contributions on time, act transparently, and demonstrate strong controls and timely remediation.
• Medium risk – Employers making genuine efforts to comply but experiencing occasional delays or inconsistencies in processes.
• High risk – Employers with repeated late payments, incorrect earnings calculations or limited engagement with ATO expectations.

The PCG emphasises that employers in the low‑risk zone will not be the focus of compliance action, reinforcing the benefits of investing early in up‑front controls, governance and testing.

Key clarifications in the final PCG

• The ATO has confirmed it will apply a risk‑based compliance model, assessing employers against payment timeliness, accuracy of Qualifying Earnings and responsiveness to issues. 
• Nine expanded examples demonstrate how employers may move between risk zones throughout the year, based on behaviour and remediation. 
• The ATO will adopt a supportive approach toward employers who demonstrate genuine efforts to comply, including prompt rectification of errors and well‑documented internal processes. 
• The PCG places heightened emphasis on data quality, including correct fund details, STP alignment and effective bounce‑back procedures. 
• The ATO reiterates that relying on clearing houses or payroll service providers does not shift employer responsibility.

Additional emerging issues affecting transition

Below are some outstanding matters raised during the consultation process for Payday Super, which were not addressed in the PCG and remain areas where further ATO or legislative clarification would be beneficial.

Moving forward

Employers should review whether their systems and processes are ready to support:

• SG being received by funds within seven business days of pay day.
• Accurate Qualifying Earnings calculations per pay cycle.
• Robust controls to detect timing errors, overpayments and bounce‑backs.
• STP and SuperStream alignment to reduce discrepancies in ATO data‑matching.

Given the new timing requirements and increased ATO visibility, early preparation remains critical. Whilst pressure is on the payroll software providers, employers must also take responsibility for readying their internal processes and controls.

How can we help?

Grant Thornton can assist with a detailed review of SG settings, payroll processes and the application of Qualifying Earnings. Typical areas of risk include:

• Incorrect treatment of allowances.
• Misclassification of annual leave loading.
• Workers compensation payments not linked to work status.
• Penalty rates incorrectly treated as overtime.

We also support employers with SG recalculations, process reviews and readiness assessments designed to ensure alignment with PCG 2026/1.

You can also register here for our webinar: FBT and Payday super update, to be held on 24 February 2026.

If you require assistance, please reach out to Elizabeth Lucas or your usual Grant Thornton advisor.

Superannuation Guarantee – recent announcements on Payday Super

Read this article