Superannuation Guide 2026: 12% Super Guarantee & Payslip Rules

“

Need to show super correctly on a payslip? Create a free Australian payslip with 12% super, PAYG withholding, Medicare levy, and HECS-HELP calculated automatically.

What Is Superannuation?

Superannuation (commonly called "super") is Australia's compulsory retirement savings system. Employers are required by law to contribute a percentage of each eligible employee's ordinary time earnings (OTE) into a nominated super fund. These contributions accumulate over a working lifetime to provide income in retirement.

Super is one of the pillars of Australia's retirement income system, alongside the Age Pension and voluntary savings. It is managed by the Superannuation Guarantee (SG) legislation, administered by the ATO.

2025-26 Super Guarantee Rate

The super guarantee rate for the 2025-26 financial year is 12% of an employee's ordinary time earnings. This rate has been progressively increasing over recent years:

The rate is legislated to remain at 12% going forward.

Who Is Eligible for Super?

Since 1 July 2022, the $450 per month earnings threshold has been removed. This means virtually all employees are now entitled to super contributions, regardless of how much they earn. This includes:

• Full-time employees
• Part-time employees
• Casual employees
• Employees under 18 who work more than 30 hours per week
• Some contractors (depending on their working arrangement)
• Working holiday makers (visa subclass 417 and 462)

The only general exceptions are employees under 18 working 30 hours or less per week, and some domestic/private workers.

Understanding Ordinary Time Earnings (OTE)

Super is calculated on ordinary time earnings, not total gross pay. Understanding what counts as OTE is critical for correct calculations.

Included in OTE:

• Base salary or wages for ordinary hours
• Shift loadings (for ordinary hours)
• Casual loading (the 25% is part of OTE)
• Commission and bonuses (in most cases)
• Allowances that are an expected part of salary (e.g., annual allowances)
• Paid leave (annual leave, personal/sick leave, long service leave)
• Leave loading (e.g., 17.5% annual leave loading)

Excluded from OTE:

• Overtime payments
• Expense reimbursements
• Workers' compensation payments
• Parental leave payments from the government
• Genuine redundancy payments above the tax-free limit

Maximum Super Contribution Base

For 2025-26, the maximum super contribution base is $65,070 per quarter. This means if an employee earns more than $65,070 in OTE per quarter, the employer is only required to pay SG on $65,070, not the full amount. Employers may choose to pay super on the excess, but it is not mandatory.

Quarterly Payment Deadlines

Super contributions must be received by the employee's super fund by the following quarterly deadlines:

Important: The contribution must be received by the super fund by the due date, not just sent. Allow processing time for bank transfers and clearing house payments.

Payday Super: Coming 1 July 2026

One of the biggest changes to the super system is payday super, which takes effect from 1 July 2026. Under the new rules:

• Employers must pay super on the same day as wages (or within 7 days)
• This replaces the current quarterly payment system
• The change aims to ensure employees' super is invested sooner, earning returns earlier
• It will also make it easier to detect and address unpaid super

What This Means for Employers:

• Your payroll systems must be updated to process super with each pay run
• You will need a reliable, efficient way to calculate and remit super every pay period
• Using PayslipMate, your super calculations are already done per pay period, making the transition seamless

Choosing a Super Fund

When a new employee starts, the process for determining their super fund is:

1. Employee's choice: The employee can nominate their preferred super fund using a Standard Choice Form
2. Stapled super fund: If the employee does not nominate a fund, you must check for their "stapled" fund via ATO online services. A stapled fund is an existing super account linked to the employee
3. Default fund: If no choice is made and no stapled fund exists, contributions go to your business's default super fund (which must be a MySuper product)

Super Guarantee Charge (SGC)

If you miss the quarterly deadline or underpay super, you become liable for the Super Guarantee Charge (SGC). The SGC consists of:

1. The shortfall amount (the super you should have paid)
2. Interest on the shortfall (currently 10% per annum)
3. An administration fee of $20 per employee per quarter

The SGC is not tax-deductible (unlike regular super contributions, which are). This makes late payment significantly more expensive than paying on time.

You must lodge a Super Guarantee Charge Statement with the ATO if you have any SG shortfall.

Salary Sacrifice and Voluntary Contributions

Some employees may ask to salary sacrifice additional amounts into super. This means:

• The extra contribution is made from pre-tax income
• It reduces the employee's taxable income (and therefore PAYG withholding)
• Concessional contributions (including SG and salary sacrifice) are capped at $30,000 per year (2025-26)
• Contributions above the cap are taxed at the employee's marginal rate plus an additional charge

Employees can also make after-tax (non-concessional) voluntary contributions, which are capped at $120,000 per year (or $360,000 using the bring-forward rule).

Super for Different Worker Types

Casual Employees

Casual employees receive super on their ordinary time earnings, which includes casual loading. If a casual worker earns $30/hour base plus $7.50 casual loading, super is calculated on $37.50/hour.

Part-Time Employees

Same rules as full-time — 12% of OTE. There is no minimum hours threshold for super eligibility (since the $450/month threshold was removed).

Contractors

Whether a contractor is entitled to super depends on whether they are an "employee" for super purposes. Generally, if a contractor is paid wholly or principally for their labour, they are entitled to SG. The ATO has specific guidelines for determining this.

Working Holiday Makers

Employers must pay super for working holiday makers just like any other employee. The only difference is the PAYG withholding rate, not the super rate.

Recording Super on Payslips

Under Fair Work requirements, every payslip must show the amount of super contributed by the employer. PayslipMate automatically:

• Calculates 12% of OTE
• Shows the employer contribution on the payslip
• Separates employer SG from any employee voluntary contributions
• Tracks YTD super contributions

Common Super Mistakes

1. Calculating super on net pay instead of gross OTE — Super is always based on gross ordinary time earnings
2. Missing the quarterly deadline — Late payments trigger the non-deductible SGC
3. Excluding casual loading from OTE — Casual loading IS part of ordinary time earnings
4. Not paying super for part-timers or casuals — All employees are eligible regardless of hours or earnings
5. Forgetting about the maximum contribution base — Only mandatory up to $65,070 per quarter
6. Not preparing for payday super — From 1 July 2026, quarterly payments will not be sufficient

How PayslipMate Handles Super

PayslipMate calculates superannuation automatically on every payslip:

• Applies the correct 12% SG rate
• Calculates based on OTE (excludes overtime)
• Respects the maximum contribution base
• Shows employer and employee contributions separately
• Provides YTD tracking for contribution cap monitoring

Get started with your first free payslip — create one now.

For a fast check, enter the employee's gross pay into the PayslipMate generator. It calculates the 12% employer super line, separates it from employee deductions, and formats the result as a professional Australian payslip PDF.