Tax Alert December 2025
Getting ready for Payday Super and clearing up FBT myths
Big payroll changes are coming. From 1 July 2026 employers must pay super contributions at the same time wages, not quarterly. The ATO is also cracking down on fringe benefits tax (FBT) compliance, especially when it comes to work vehicles. Here’s what you need to know.
Payday Super: what employers must do
Employers will need to ensure they start preparing their payroll systems following the passing of the Treasury Laws Amendment (Payday Superannuation) Act 2025 on 4 November 2025.i
From 1 July 2026, employers will be required to make superannuation contributions for their employees at the same time as they pay their salary or wages, rather than quarterly as currently required.
More frequent super contributions will help employees’ super balances grow faster. But, for employers, it may affect cash flow by removing access to funds previously held until quarterly payments, so planning ahead is essential.
Small Business Clearing House closing
The ATO is again reminding employers that as part of the Payday Super reforms, the Small Business Super Clearing House (SBSCH) will close on 1 July 2026.
Although new users can no longer register to use the service, small businesses who are still using the SBSCH, need to begin transitioning to alternative services.
During the transition process, most employers will need to review their current software and payroll packages for super payment functions, or check the options offered by super funds, commercial clearing houses and payroll providers. If you are unsure of your options, you can contact us.
ATO’s compliance approach
The ATO has released draft guidelines covering its compliance approach during the first year of operation for the Payday Super legislation.
Employers will be classified into three risk zones, with the ATO prioritising its compliance resources on employers classified as being high or medium risk. The risk zone can change from pay period to pay period.
High risk employers will be those who have one or more ‘final individual SG shortfalls’ that have not been reduced to nil by the 28th day following the end of the quarter the qualifying earnings were paid, or if the employer is not otherwise in the low or medium risk zones.
Payroll governance in the spotlight
Small business employers are being encouraged to take a closer look at their payroll governance to check they are meeting their employer obligations in relation to taxes (PAYG, FBT), reporting (Single Touch Payroll) and super (SG and other super contributions).
According to the ATO, employers must have payroll governance measures that are effective and fit for purpose, which means having systems and processes tailored to their business’ structure, size, complexity and industry.
These systems should support the business to comply with its legal obligations and help it to identify and mitigate risks (such as administrative errors, employee fraud and cybercrime).
SMSFs and NPP readiness
From 1 July 2026, all SMSFs and super funds will need to ensure they can receive and allocate New Payment Platform (NPP) payments.
The NPP is a real-time payments platform used across Australia and it improves how quickly contributions can be received by employees’ super funds.
The changes mean SMSFs will be required to accept contribution payments and related data from employers via the super industry’s SuperStream standard, which uses a standardised electronic format.
Dual cab utes: FBT myths
Dual cab utes remain in the ATO’s sights as there is a common myth that employee use of these popular vehicles is automatically exempt from FBT.
However, the ATO is warning employers that providing a dual cab ute to an employee to complete their duties and also making it available for personal use may be subject to FBT.
For an employee’s personal use to be exempt, the vehicle must be both an eligible vehicle and only used for limited private use, meaning minor, infrequent or irregular use. FBT applies if the vehicle is used as the family taxi or for weekend personal trips.
If you need assistance implementing any of these changes before 1 July 2026 or you need a better understanding of how FBT works, reach out to Carrick Aland’s tax team, we’re always here to help.
i Treasury Laws Amendment (Payday Superannuation) Act 2025 – Federal Register of Legislation
