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Industry and business not ready for Payday Super - CPA Australia

CPA Australia

9 May 2025

Industry and business not ready for Payday Super – CPA Australia

• Payday Super should be delayed for up to two years
• Transition could result in chaos if infrastructure is not ready
• Small businesses need more time to meet expectations

CPA Australia is urging the federal government to postpone the rollout of the Payday Super regime for up to two years to give the superannuation industry and small businesses sufficient time to meet the new requirements.

If the timeframe is not extended, a period of chaos could ensue as businesses try to fulfill their compliance obligations through a system that potentially can’t deliver.

Payday Super, designed to ensure eligible employees are paid superannuation entitlements by their employers as part of their regular pay cycle, is due to take effect from 1 July 2026.

In a joint submission to Treasury this week, eight professional bodies, including CPA Australia, have set out their concerns and key recommendations to ensure a smooth transition to the new model once all stakeholders are prepared.

CPA Australia’s Superannuation Lead, Richard Webb, said CPA Australia is a strong advocate for the goals of Payday Super, but the superannuation industry and small businesses are not yet ready for the change and compliance obligations it brings.

“One of our main concerns is that the superannuation transmission network will not be ready to manage the increased traffic by July next year,” he said. “We believe it is vital to postpone the start date for Payday Super by at least a year, ideally 24 months, to allow all stakeholders sufficient time to comply with the new logistical demands on the system.

“The superannuation transmission network is fundamental to the successful delivery of Payday Super. If it is not adequately prepared for the transition it would create a perfect storm of confusion and uncertainty for both employees and employers.

“The practicalities of delivering once-in-a-generation reform of the infrastructure underpinning the superannuation payments system are extremely challenging.”

Mr Webb says the weight of expectation on small businesses is another good reason to delay the rollout.

“The new regime will be challenging for some big businesses, but small businesses will be particularly impacted by the change. The regime requires considerable upfront cash flow and system changes, posing difficulties for small businesses that may lack the resources and technological proficiency to adapt swiftly,” he said.

“Advisors and accountants will be critical to a smooth transition and will need the time to support and educate their millions of small business clients.

“The government should introduce a grace period to allow employers to receive education and support without immediate penalties for non-compliance.

“Delivering Payday Super reliably, fairly and without unintended consequences must be the priority.”

Editor’s Note:

The submission was developed by CPA Australia, Australian Bookkeepers Association, Chartered Accountants Australia and New Zealand, Financial Advice Association of Australia, Institute of Certified Bookkeepers, Institute of Public Accountants, SMSF Association and The Tax Institute.

About us:

About CPA Australia   

CPA Australia is Australia’s leading professional accounting body and one of the largest in the world. We have more than 174,000 members in over 100 countries and regions. Our core services include education, training, technical support and advocacy. CPA Australia provides thought leadership on local, national and international issues affecting the accounting profession and public interest. We engage with governments, regulators and industries to advocate policies that stimulate sustainable economic growth and have positive business and public outcomes. Find out more at cpaaustralia.com.au

Contact details:

Simon Downes, External Affairs Lead, [email protected] or 0401 461 503