Treasury Laws Amendment (Payday Superannuation) Act 2025 (57 of 2025)

Schedule 1   Amendments

Part 1   Amendment of the Superannuation Guarantee (Administration) Act 1992

Division 1   Main amendments

Superannuation Guarantee (Administration) Act 1992

12   Sections 16 to 29

Repeal the sections, substitute:

Division 2 - Superannuation guarantee charge payable by employers

Subdivision A - Superannuation guarantee charge is payable on superannuation guarantee shortfalls

16 Simplified outline of this Division

Superannuation guarantee charge is payable on an employer's superannuation guarantee shortfalls.

Such a shortfall can arise in 2 ways.

The first way is if the employer:

(a) pays qualifying earnings to an employee; or

(b) reduces an employee's qualifying earnings so that a sacrificed contribution can be made for the employee;

without also making sufficient timely eligible superannuation contributions for the benefit of the employee (see Subdivisions B and C).

The amount of charge on a shortfall arising in this way will include notional earnings on the shortfall and an administrative uplift amount (see Subdivision D).

The second way is if the employer fails to comply with the choice of fund requirements when making eligible superannuation contributions for the employee (see Subdivision E).

16A Superannuation guarantee charge payable by employers

Superannuation guarantee charge imposed on an employer's superannuation guarantee shortfall for a QE day is payable by the employer.

16B Superannuation guarantee shortfalls

(1) This section applies if an employer has:

(a) one or more individual base superannuation guarantee shortfalls for a QE day that are greater than nil; or

(b) one or more choice loadings for a QE day that are greater than nil.

(2) The employer has a superannuation guarantee shortfall for the QE day equal to the sum of the following:

(a) the total of the employer's individual final superannuation guarantee shortfalls for the QE day;

(b) the total of the employer's individual notional earnings components for the QE day;

(c) the employer's administrative uplift amount for the QE day;

(d) the total of the employer's choice loadings for the QE day.

Note: Some (but not all) of these amounts may be nil.

Subdivision B - Individual superannuation guarantee amounts arise if qualifying earnings are paid etc.

17 Simplified outline of this Subdivision

If on a particular day an employer:

(a) pays qualifying earnings to an employee; or

(b) reduces an employee's qualifying earnings so that a sacrificed contribution can be made for the employee;

then, on that day, the employer has an individual superannuation guarantee amount for the employee equal to a particular percentage of the payment or reduction.

However, the amount will be nil if an exemption certificate covers the employer and the employee for that day.

17A When an individual superannuation guarantee amount arises

(1) This Subdivision applies if an employer makes a payment of qualifying earnings to or for an employee on a particular day (the QE day ).

Note: This includes reducing the employee's earnings so that a sacrificed contribution can be made for the employee (see paragraphs 10A(1)(h) and (4)(b)).

(2) On the QE day, the employer has an individual superannuation guarantee amount for the employee equal to:

where:

amount of the qualifying earnings means:

(a) if there is one such payment - the amount of the payment; or

(b) if there are 2 or more such payments - the sum of the amounts of the payments.

Note: If the payment of qualifying earnings is in the form of a reduction so that a sacrificed contribution can be made, the amount of the payment is the amount of the reduction (see paragraph 10A(1)(h)).

charge percentage means 12.

17B An exemption certificate can reduce this amount to nil

However, if an employer shortfall exemption certificate is in force for the employee in relation to:

(a) the employer; and

(b) a period that includes the QE day;

treat the employee as having already reached the maximum contributions base before the QE day.

Note 1: This means:

(a) the amount of the payment of qualifying earnings on the QE day is treated as if it were nil (see subsection 10A(6)); and

(b) the individual superannuation guarantee amount is nil.

Note 2: If the employee has more than one employer and the certificate is issued in relation to only this employer, then the certificate does not affect the other employers' individual superannuation guarantee amounts.

17C Issuing an exemption certificate

Issuing of certificate

(1) The Commissioner may, on application by an employee, issue a certificate (an employer shortfall exemption certificate ) to the applicant for:

(a) a specified employer of the applicant at the time the application is made; and

(b) a specified period ending at the end of a specified financial year;

if the Commissioner is satisfied of the matters in subsection (2).

(2) The matters are that:

(a) if the certificate is not issued, the applicant is likely to have excess concessional contributions for that financial year (whether or not issuing the certificate would prevent that result); and

(b) if the certificate is issued for that period, at least one other employer of the applicant is likely to have an individual superannuation guarantee amount for:

(i) the applicant; and

(ii) a QE day during that financial year;

that is greater than nil; and

(c) it is appropriate in the circumstances to issue the certificate.

(3) When considering a matter in subsection (2), the Commissioner:

(a) for the matter in paragraph (2)(a) or (b) - must have regard to any other employer shortfall exemption certificate that has been issued, or is proposed to be issued, to the applicant for that financial year; and

(b) for the matter in paragraph (2)(c) - may have regard to:

(i) the effect that issuing the certificate is likely to have on the applicant's concessional contributions for that financial year; and

(ii) any other matter that the Commissioner considers relevant.

Application for certificate

(4) An application for an employer shortfall exemption certificate:

(a) must be in the approved form; and

(b) must specify the employer, period and financial year to be specified in the certificate; and

(c) must be made at least 30 days before the first day of the period.

Objections and other matters

(5) A person who is dissatisfied with a decision of the Commissioner under subsection (1) may object against the decision in the manner set out in Part IVC of the Taxation Administration Act 1953.

(6) The Commissioner may not vary or revoke an employer shortfall exemption certificate.

(7) An employer shortfall exemption certificate:

(a) may be issued after the first day of the period specified in the certificate; and

(b) is not a legislative instrument.

17D Notice about an exemption certificate

(1) If the Commissioner makes a decision under subsection 17C(1) about an application, the Commissioner must give written notice of the decision to:

(a) the applicant; and

(b) if the decision is to issue a certificate - the employer to which the certificate relates.

(2) A notice of a decision to issue a certificate must include a copy of the certificate.

(3) The Commissioner is treated as having decided not to issue a certificate to the applicant if the Commissioner does not give notice (under subsection (1)) of the decision during the 60-day period starting on the day the application was made.

Subdivision C - Individual superannuation guarantee shortfalls arise if insufficient timely eligible superannuation contributions are made

18 Simplified outline of this Subdivision

This Subdivision is relevant if an employer has an individual superannuation guarantee amount for an employee that is greater than nil.

The employer will have an individual base superannuation guarantee shortfall for the employee that will result in superannuation guarantee charge if the employer does not make an equivalent amount of eligible superannuation contributions:

(a) for the benefit of the employee; and

(b) within a particular period.

The employer can reduce the amount of the charge by making eligible superannuation contributions:

(a) for the benefit of the employee; and

(b) up until the day before the Commissioner makes an assessment of the amount of the charge.

18A Meaning of eligible contribution - main rules

(1) An eligible contribution , made by an employer for the benefit of an employee, is:

(a) a contribution (other than a sacrificed contribution) made by the employer for the benefit of the employee that:

(i) is to a complying superannuation fund; and

(ii) is able to be allocated within the fund for the benefit of the employee; and

(iii) is not made for the benefit of the employee as a defined benefit member of a defined benefit superannuation scheme; and

(iv) is not made at a time when a conversion notice has effect in relation to the fund; or

(b) a contribution (other than a sacrificed contribution) made by the employer for the benefit of the employee:

(i) to an RSA; and

(ii) that is able to be allocated within the RSA for the benefit of the employee; or

(c) if:

(i) the employee has died; and

(ii) the employer would, if the employee had not died, have made a contribution covered by paragraph (a) or (b) for the benefit of the employee; and

(iii) the employer instead pays an equivalent amount to the employee's legal personal representative;

that equivalent amount paid by the employer; or

(d) a contribution notionally made as described in subsection (3) to a defined benefit superannuation scheme for the benefit of the employee as a defined benefit member of the scheme.

Note: For the purposes of subparagraphs (a)(ii) and (b)(ii), regulations under the Superannuation Industry (Supervision) Act 1993 and under the Retirement Savings Accounts Act 1997 deal with the allocation of contributions.

Presumption for contributions to certain superannuation funds

(2) A contribution made by the employer for the benefit of the employee to a superannuation fund is conclusively presumed to be a contribution to a complying superannuation fund for the purposes of subparagraph (1)(a)(i) if:

(a) at or before the time the contribution is made, the employer has obtained a written statement provided by or on behalf of the trustee of the fund; and

(b) the statement provides that the fund:

(i) is a resident regulated superannuation fund; and

(ii) is not subject to a direction under section 63 of the Superannuation Industry (Supervision) Act 1993.

Note 1: The presumption does not extend to any of the other elements of paragraph (1)(a), such as that the contribution must not be a sacrificed contribution.

Note 2: The presumption may not always be available (see section 18B).

Notional contributions for defined benefit members of defined benefit superannuation schemes

(3) If, on a QE day for the employer and the employee:

(a) a benefit certificate for a defined benefit superannuation scheme has effect; and

(b) the scheme is operating for the benefit of the employee:

(i) as a defined benefit member of the scheme; and

(ii) in relation to payments of qualifying earnings to or for the employee by the employer; and

(c) the benefit certificate:

(i) covers a class of employees (that includes the employee) as defined benefit members of the scheme; and

(ii) specifies the notional employer contribution rate in relation to that class of employees; and

(d) the employer has a written statement, provided by or on behalf of the trustee of the scheme, that the scheme:

(i) is a resident regulated superannuation fund; and

(ii) is not subject to a direction under section 63 of the Superannuation Industry (Supervision) Act 1993; and

(iii) has not been subject to such a direction at any time since the beginning of the day on which the benefit certificate is expressed to take effect;

treat the scheme as having received, on the QE day, a notional contribution made by the employer for the benefit of the employee that is equal to:

where:

amount of the qualifying earnings has the same meaning as in subsection 17A(2) for the one or more payments of qualifying earnings to or for the employee made by the employer on the QE day.

Note: The written statement may not always have effect (see section 18B).

18B Meaning of eligible contribution - exceptions

(1) However:

(a) the presumption in subsection 18A(2) is unavailable for a contribution to a fund if subsection (2) of this section applies on the day the contribution is made; or

(b) a statement provided as described in paragraph 18A(3)(d) has no effect for a scheme if subsection (2) of this section applies on the QE day.

(2) This subsection applies on a day if, on that day:

(a) one of the following subparagraphs applies:

(i) the employer is the trustee or manager of the fund or scheme;

(ii) the employer is an associate of the trustee or manager of the fund or scheme;

(iii) the trustee or manager of the fund or scheme is an associate of the employer; and

(b) the employer reasonably believes that the fund or scheme:

(i) is not a resident regulated superannuation fund; or

(ii) is operating in contravention of a regulatory provision (within the meaning of section 38A of the Superannuation Industry (Supervision) Act 1993).

(3) Section 39 of the Superannuation Industry (Supervision) Act 1993 applies for the purposes of subparagraph (2)(b)(ii) of this section in a corresponding way to the way that section applies for the purposes of Division 2 of Part 5 of that Act.

Note: Section 39 of that Act allows certain contraventions to be ignored.

18C Employer's individual base superannuation guarantee shortfall for an employee and a QE day

Meaning of individual base superannuation guarantee shortfall

(1) An employer's individual base superannuation guarantee shortfall for an employee and a QE day is equal to:

where:

eligible contributions relevant for the QE day means so much of each eligible contribution made by the employer for the benefit of the employee as:

(a) is applied under this subsection for the QE day (the current QE day ), and has not been applied under this subsection or section 18D for an earlier QE day; and

(b) is applied under this subsection in the order that it is received by the relevant fund, RSA, representative or scheme; and

(c) is so received during one of these periods (the standard periods ):

(i) the usual period for the current QE day; or

(ii) the 12-month period ending on the day before the current QE day;

or before the end of the latest day in any applicable items of the table in subsection (2) of this section; and

(d) does not cause the amount resulting from this subsection for the employee and the QE day to be less than nil.

Note: An eligible contribution in the form of a notional contribution to a defined benefit superannuation scheme will always be covered by subparagraph (c)(i) because it is treated as being received on the current QE day (see subsection 18A(3)).

Allowable longer periods for receiving eligible contributions

(2) In addition to the standard periods, the eligible contribution can be received before the end of the latest day in any applicable item of the following table:

Note: When the contribution is received is not the only factor for whether it is an eligible contribution relevant for the QE day (see paragraphs (a), (b) and (d) of the definition of that expression in subsection (1)).

Kinds of out-of-cycle qualifying earnings

(3) The Commissioner may, by legislative instrument, determine:

(a) kinds of out-of-cycle qualifying earnings; and

(b) the circumstances that must exist for qualifying earnings to be one of those kinds.

Qualifying earnings in exceptional circumstances

(4) The Commissioner may, by legislative instrument, determine:

(a) one or more kinds of employers that are affected by exceptional circumstances of a kind prescribed by the regulations that affect the ability of the employers to make eligible contributions; and

(b) the period during which any QE days for payments of qualifying earnings by those employers are affected by those exceptional circumstances.

The period determined for the purposes of paragraph (b) may start before the day the determination is made.

Note 1: Examples of exceptional circumstances for this purpose include natural disasters, or widespread outages of information and communications technology services, that affect multiple employers on a large scale.

Note 2: If the period starts before the day the determination is made, eligible contributions can still be counted if made before the end of the 20 business day period starting on the day after the determination is made (see item 3 of the table in subsection (2)).

18D Employer's individual final superannuation guarantee shortfall for an employee and a QE day

(1) An employer's individual final superannuation guarantee shortfall for an employee and a QE day is:

(a) if the employer's individual base superannuation guarantee shortfall for the employee and QE day is nil - nil; or

(b) otherwise - equal to the amount in subsection (2).

(2) The amount is:

where:

eligible contributions relevant for the late period for the QE day means so much of an eligible contribution made by the employer for the benefit of the employee as:

(a) is applied under this section for the QE day, and has not been applied under this section for an earlier QE day; and

(b) is applied under this subsection in the order that it is received by the relevant fund, RSA, representative or scheme; and

(c) is so received during the late period for the QE day; and

(d) does not cause the amount resulting from this subsection for the employee and the QE day to be less than nil.

Subdivision D - Notional earnings and administrative uplift

19 When this Subdivision applies

This Subdivision applies if an employer has an individual base superannuation guarantee shortfall for an employee and a QE day that is greater than nil.

19A Individual notional earnings component - sum of an amount for each day that the individual final superannuation guarantee shortfall is greater than nil

(1) The employer's individual notional earnings component for the employee and the QE day is the sum of each amount worked out under subsection (2) for each day that:

(a) is during the late period for the QE day; and

(b) is a day on which the employer's individual final superannuation guarantee shortfall for the employee and the QE day is greater than nil.

Note: Subsection 36(3) may affect the days that paragraph (b) applies to.

(2) For a day referred to in subsection (1) for the QE day, work out:

where:

general interest charge rate has the same meaning as in section 8AAD of the Taxation Administration Act 1953.

notional sum means the sum of:

(a) the employer's individual base superannuation guarantee shortfall for the employee and the QE day; and

(b) the amount worked out under this subsection for each earlier day referred to in subsection (1) for the QE day.

19B Administrative uplift for a QE day

(1) The employer's administrative uplift amount for the QE day is equal to 60% of the sum of:

(a) the total of the employer's individual final superannuation guarantee shortfalls for the QE day; and

(b) the total of the employer's individual notional earnings components for the QE day.

Note: The administrative uplift amount will be nil if these totals are nil.

(2) However, this amount may be reduced (but not below nil) in accordance with the regulations.

(3) For the purposes of (but without limiting) subsection (2), the regulations may prescribe the following:

(a) a method for reducing an employer's administrative uplift amount for a QE day that relies on one or more of the following:

(i) whether the Commissioner has previously made an assessment for the employer on the Commissioner's own initiative;

(ii) whether the Commissioner has previously made an estimate under subsection 268-10(1) in Schedule 1 to the Taxation Administration Act 1953 for the employer for a liability to pay superannuation guarantee charge;

(iii) whether (and when) the employer lodges a voluntary disclosure statement under section 33 for the QE day;

(b) a method that depends on a person being satisfied of one or more specified matters.

Subdivision E - Loading for failing to comply with choice of fund requirements

20 When this Subdivision applies

This Subdivision applies if:

(a) an employer has an individual superannuation guarantee amount for an employee and a QE day; and

(b) the employer makes, for the benefit of the employee, one or more eligible contributions that:

(i) result in the employer's individual base superannuation guarantee shortfall, or individual final superannuation guarantee shortfall, for the employee and the QE day being less than what it would otherwise be; or

(ii) if the amount mentioned in paragraph (a) is nil - would have resulted in a shortfall mentioned in subparagraph (i) being less than what it would have otherwise been had the amount mentioned in paragraph (a) been greater than nil.

20A Employer's choice loading for the QE day

(1) The employer's choice loading for the employee and the QE day is:

(a) if subsection (2) or (3) applies to some or all of those eligible contributions - the lower of:

(i) the amount equal to 25% of the total of the contributions to which that subsection applies; and

(ii) the choice loading limit for the QE day; or

(b) otherwise - nil.

Contributions made to an RSA or a fund other than a defined benefit superannuation scheme

(2) This subsection applies if:

(a) some or all of the contributions mentioned in paragraph 20(b) are not made in compliance with the choice of fund requirements; and

(b) section 20D (relying on most recent Commissioner notification) does not apply to the contributions.

Contributions notionally made to a defined benefit superannuation scheme

(3) This subsection applies if:

(a) some or all of the contributions mentioned in paragraph 20(b):

(i) are notionally made as described in subsection 18A(3) to a defined benefit superannuation scheme; and

(ii) if paragraph 32C(2)(c) were disregarded - would not have been made in compliance with the choice of fund requirements if they had been actually (rather than notionally) made to the scheme; and

(b) none of subsections 20B(2), (3) and (4) apply to the employer for the employee, the scheme and the QE day; and

(c) section 20D (relying on most recent Commissioner notification) does not apply to the contributions.

Note: Paragraph 32C(2)(c) is a requirement for a fund to include a MySuper product.

20B Defined benefit schemes - certain cases where members cannot choose another fund

(1) This section applies for the purposes of paragraph 20A(3)(b).

Scheme in surplus

(2) This subsection applies if:

(a) the employee was a defined benefit member of the fund immediately before 1 July 2005 and has not ceased to be such a member during the period (the membership period ):

(i) starting on 1 July 2005; and

(ii) ending at the end of the QE day; and

(b) an actuary has provided a certificate in accordance with regulations under the Superannuation Industry (Supervision) Act 1993 stating that the employer is not required to make contributions for a period including the QE day, and there has been such a certificate covering all times since 1 July 2005; and

(c) an actuary has provided a certificate stating that, in the actuary's opinion, at all times during the membership period there is a high probability that the assets of the scheme are, and will be, equal to or greater than 110% of the greater of the scheme's liabilities in respect of vested benefits and the scheme's accrued actuarial liabilities.

The certificate under paragraph (c) must have been provided no earlier than 15 months before the QE day.

Member has accrued maximum benefit

(3) This subsection applies if, on the QE day, the defined benefit that has accrued to the employee will not increase other than:

(a) as a result of increases in the employee's salary or remuneration; or

(b) by reference to accruals of investment earnings; or

(c) by reference to indexation based on, or calculated by reference to, a relevant price index or wages index; or

(d) in any other way prescribed by the regulations.

Member's benefit not affected

(4) This subsection applies if the employee would be entitled, on the employee's retirement, resignation or retrenchment, to the same amount of benefit from the defined benefit superannuation scheme, whether or not the employee had contributions:

(a) for the QE day; and

(b) made by the employer for the benefit of the employee;

to a fund (within the meaning of Part 3A) other than the defined benefit superannuation scheme.

Meaning of scheme's accrued actuarial liabilities and scheme's liabilities in respect of vested benefits

(5) In this section:

scheme's accrued actuarial liabilities , at a particular time, means the total value, as certified by an actuary, of the future benefit entitlements of members of the scheme in respect of membership up to that time based on assumptions about:

(a) future economic conditions; and

(b) the future of matters affecting membership of the scheme;

being assumptions made in accordance with applicable professional actuarial standards (if any).

scheme's liabilities in respect of vested benefits , at a particular time, means the total value of the benefits payable from the scheme to which the members of the scheme would be entitled if they all voluntarily terminated their service with their employers at that time.

20C Limit on choice loading for the QE day

(1) The choice loading limit for the QE day (the current QE day ) is $1,200.

(2) However, this amount is reduced (but not below nil) by the amount equal to 25% of the sum of any other eligible contributions:

(a) made by the employer for the benefit of the employee; and

(b) to which subsection 20A(2) or (3) applies for any earlier QE day for the employer and employee during the notice period that includes the current QE day.

(3) In this section:

notice period means the period:

(a) beginning on the latest of:

(i) the day the employee's employment with the employer starts; and

(ii) the day after the end of the immediately preceding notice period for the employer and the employee; and

(iii) 1 July 2026; and

(b) ending on the day the Commissioner gives the employer written notice that the employer's notice period for the employee has ended.

20D Relying on most recent Commissioner notification

This section applies to an eligible contribution for the benefit of the employee that is not made in compliance with the choice of fund requirements if:

(a) the employer attempts to make the contribution at a particular time; and

(b) at that time, there is no chosen fund for the employee; and

(c) at that time, the most recent notification to the employer:

(i) by the Commissioner; and

(ii) relating to a request by the employer (or by the employer's agent) for the Commissioner to identify any stapled fund for the employee;

is that the Commissioner is satisfied that the fund is the stapled fund for the employee; and

(d) the fund does not accept the contribution from the employer for the benefit of the employee; and

(e) the employer made the contribution to another fund for the benefit of the employee.

Division 3 - Arrangements to avoid paying superannuation guarantee charge