Payday Super flow-on effects to contribution caps: issues, relief and considerations for employers and employees

Identifying potentially affected employees and preparing clear responses now can help employers reduce the time and effort spent resolving queries later. In this article, we explain which contributions may qualify for relief and how carry-forward amounts may help. We also outline checks individuals can make to identify potential cap issues, and the records and responses businesses can prepare to handle those conversations consistently.

Why the cap may be an issue

From 1 July 2026, Payday Super replaced quarterly compulsory employer superannuation payments. Employers must generally ensure superannuation guarantee contributions reach the employee’s fund within seven business days after payday, with sufficient information for allocation to the member’s account.

The concessional contributions cap issue

When determining available concessional cap space for a financial year, contributions are generally counted in the year the superannuation fund receives them, rather than the period to which they relate.

Under the former quarterly rules, employers generally had to ensure contributions for the quarter ended 30 June 2026 reached the employee’s superannuation fund by 28 July 2026, the final quarterly deadline before Payday Super. Contributions received by the employee’s fund after 30 June 2026 would generally count towards the employee’s concessional contributions for 2026–27.

Employer contributions for paydays from 1 July 2026 will also generally count towards the employee’s concessional contributions for 2026–27. Consequently, that year could include employer contributions relating to up to 15 months of earnings.

Concessional contributions generally include:

• Employer contributions, including compulsory superannuation guarantee contributions
• Salary sacrifice contributions
• Personal contributions for which a tax deduction is claimed

Proposed relief

The proposed legislation was introduced to Parliament on 14 October 2026 and, at the time of writing, had passed the House of Representatives but was still progressing through the parliamentary approval process.

If enacted, the measure may exclude certain June 2026 quarter super contributions from an individual’s 2026–27 concessional contributions where needed to prevent them exceeding the standard concessional contributions cap.

Where the conditions are met, relief is expected to apply automatically and affected individuals should not need to take action.

Which contributions may qualify?

The proposed relief targets two categories of employer contributions:

• Contributions allocated to an employer’s superannuation guarantee obligation for the quarter ended 30 June 2026 under the Payday Super transitional rules; and
• Certain contributions required under an award, enterprise agreement or prescribed State industrial instrument for earnings during the June 2026 quarter, where the contribution was made between 1 July and 28 July 2026.

Receipt in July 2026 alone would not qualify a contribution for relief as its character, the obligation it relates to and the timing requirements all matter.

Salary sacrifice contributions would continue to count towards the employee’s concessional contributions and should be considered separately from qualifying June-quarter employer contributions.

How carry-forward amounts fit in

Employees may be able to carry forward unused concessional cap amounts from earlier years if their total superannuation balance was less than $500,000 at the end of the previous financial year.

First, the proposed transitional adjustment is calculated by reference to the basic concessional contributions cap. Available carry-forward amounts are then taken into account under the ordinary rules to determine whether excess concessional contributions remain.

Example – Emma’s concessional contributions for 2026-27

Emma receives the following concessional contributions during 2026–27:

• $7,500 from her employer relating to the June 2026 quarter, received by her fund in July 2026
• $28,000 of employer contributions relating to her 2026–27 paydays
• $6,000 of salary sacrifice contributions

Her total is $41,500—$9,000 above the 2026–27 basic cap of $32,500.

If the legislation is enacted in its current form and the June-quarter contribution meets all conditions, the full $7,500 would be disregarded, reducing her counted contributions to $34,000. The $6,000 salary sacrifice contribution cannot be disregarded under this measure.

Emma’s total superannuation balance at 30 June 2026 was below $500,000. She has $4,000 of unused carry-forward cap amounts and meets the other eligibility requirements.

She can use $1,500 of those amounts to cover the gap between $34,000 and the $32,500 basic cap. She would have no excess concessional contributions and would retain $2,500 of carry-forward amounts, subject to ordinary expiry rules.

What should employees and employers do?

Individuals: check for potential cap issues

• Check your superannuation fund transaction records for June 2026 quarter employer contributions received in July 2026, alongside contributions for 2026–27 paydays.
• Ask payroll to clarify the period and type of any employer contribution you cannot identify. A July receipt date alone does not establish eligibility for the proposed relief.
• Review employer, salary sacrifice and personal deductible contributions together. Salary sacrifice contributions would not qualify for the proposed relief.
• If those contributions may exceed your available cap, check whether you have eligible carry-forward amounts and seek individual advice before making further salary sacrifice or personal deductible contributions. Emma’s example illustrates how the proposed relief and carry-forward amounts may interact.

Employers: keep clear contribution records

Employers should keep clear records of the timing, nature and allocation of superannuation contributions made during the transition to Payday Super, including:

• The period to which the contribution relates, for example, the quarter ended 30 June 2026 or a payday on or after 1 July 2026
• The date the contribution was made and received by the employee’s superannuation fund
• The type of contribution (for example – compulsory employer contribution, salary sacrifice or other)
• Whether the contribution was made under an award, enterprise agreement or prescribed State industrial instrument

If June 2026 quarter contributions were not received by the fund by 28 July 2026, employers may need to lodge a superannuation guarantee charge statement and pay the resulting Superannuation Guarantee Charge (SGC). The late payment offset is unavailable for that quarter; paying the fund later may not reduce the SGC liability.

Prepare for employee queries

Use these records to identify potentially affected employees and prepare for questions that may arise later. A clear approach and agreed scripting can help reduce the time, cost and effort involved for finance and payroll teams.

• Identify employees whose June 2026 quarter employer contributions were received by their funds after 30 June 2026, alongside contributions for 2026–27 paydays. Review salary sacrifice arrangements separately. These records can flag potential issues, but may not show an employee’s complete cap position.
• Agree who will handle employee queries, what contribution information finance and payroll teams can provide and when to refer employees for individual advice.
• Prepare consistent templates covering the contribution period, type and payment dates, the limits of the proposed relief and why individual outcomes may differ to reduce the administrative burden.

Keep payroll obligations and employee cap outcomes separate

Employer records can flag potential issues, but do not provide a complete assessment of an employee’s contributions. Employers should identify potentially affected employees, retain clear records and prepare consistent responses and referrals. Individuals should review fund records, ask payroll about employer payments and seek advice on their overall cap position. This shared preparation can reduce repeated work for finance and payroll teams.

For more information or support with the Payday Super transition, contact your usual Forvis Mazars advisor or get in touch using the contact details below.

Authors: Joel Orbita

Published: 10 November 2026

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