Payday super and contractors: what you need to know

Payday Super is bringing a shift in how often super must be paid, and contractors are part of that conversation.

Under the super rules, some contractors are treated the same as employees for super purposes. If a contractor falls under the ATO definition of an employee for super purposes, you are required to pay super for them, even if they have an ABN and invoice you.

With the introduction of Payday Super, super must be paid at the same time the contractor is paid, rather than being deferred to quarterly due dates.

For contractors paid weekly or fortnightly, super must be paid on or before each pay day. If a contractor is paid monthly, super is due when the monthly payment is made. Where contractors are paid quarterly or on an ad hoc basis, super must be paid alongside each payment, not at the end of the quarter.

This change means the previous practice of paying super quarterly will no longer apply for eligible contractors. Businesses will need to plan for more frequent super payments and ensure their cashflow and payroll systems are set up correctly.

Payday Super is scheduled to apply from 1st July 2026, so now is a good time to review which contractors you pay super for, how often they are paid and whether your systems are ready. Preparing early can help reduce compliance risks and avoid cashflow pressure later on.

If you want to make sure your contractor super payments are ready for Payday Super, we can help you review your arrangements, plan for more frequent payments and update your payroll systems before 1st July 2026. Get in touch today to make sure you’re compliant and ready.

This information is intended to be general in nature and is not personal financial advice. It does not take into account your objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information provided in relation to your own circumstances.