The Future of Super: Payday Super
On the 2nd of May 2023, the Australian federal government announced Payday Super. What is it, and how will this proposed change in legislation affect employers, employees and payroll software providers?
Beam makes Payday Super simpler
During the federal Budget the Australian Treasury announced potential legislation that as of 2026, Australian employers will be required to pay super into their employees chosen fund at the same time as processing salaries. Payday Super is an effort to reduce an estimated $3.4 billion AUD worth of missed super payments in 2019-2020¹. Included in the statement for Payday, further resources will be made available to the Australian Tax Office (ATO) to aid in their ability to detect and recover unpaid super payments. Currently quarterly super payments are a minimum requirement for Australian businesses, although some larger organisations do already align super contributions with payroll schedule. This change has the potential to impact payroll software providers who are not equipped to take on these changes. Legislative changes can disrupt a software company, adopting new technology and ideas should be a priority to keep employers using software fit for purpose and prepared for the future.
Payroll Platforms can grow
With potential to disrupt existing payroll processes, the proposed changes with Payday Super could be a great opportunity for software providers to enhance their product and grow their client base. For the 2021-2022 financial year, 891,000 Australian employers reported their super obligations through a Single Touch Payroll (STP)². In the 2021-2022 financial year, 17,300 cases of unpaid super that were raised with the ATO resulting in $215 million of fines being issued and $550 million of Super Guarantee Liabilities being raised³. With the potential of added compliance requirements on employers and payroll software, this figure could grow. The team at Beam want to work with payroll platforms to see this figure decrease. Payday Super brings the opportunity for software providers to improve the compliance flow for employers by providing simple, easy and compliant software for making regular super payments and STP reporting. Beam can provide STP solutions or provide a clearing house service for super payments without the need to develop considerable functionality into an existing payroll platform. This proposed legislation would put the spotlight on the usability of payroll platforms, Payday Super means more super contributions and higher usage of payroll software.