The SMSF Association has welcomed the Federal Government’s decision that requires superannuation to be paid on pay day.
SMSF Association CEO Peter Burgess says this announcement today by the Assistant Treasurer and Minister for Financial Services, Stephen Jones, will particularly benefit the increasing number of younger Australians opting to use a self-managed super fund (SMSF) as their retirement savings vehicle.
“About 40 per cent of new SMSFs are now being established by individuals under the age of 45 who have many years of Superannuation Guarantee (SG) contributions ahead of them. So, this reform that requires employers from 1 July 2026 to pay their employees’ superannuation at the same time as their salary and wages is welcome news.
“It will help strengthen the superannuation system by ensuring greater SG compliance and ultimately will result in individuals enjoying higher balances in retirement.
“In addition to benefiting those in lower paid, casual, and insecure work who are more likely to miss out when super is paid less frequently, it will also provide added certainty in terms of the timing of contributions which, from an advice and contribution planning perspective, can be critically important and may help to reduce instances of inadvertent cap breaches.
“It will also provide greater levels of transparency and hopefully engagement as employees will find it easier to track their SG contributions by linking it to their wage payments,” Burgess says.