Payday super and STP reporting

The new concept of “qualifying earnings” (QE) is set to take over as the basis for real-time super compliance. Super on QE will be due within 7 days of payday.

QE is the concept for determining the base that’s subject to super, taking over from Ordinary Time Earnings (OTE).

This brings a big change to Single Touch Payroll (STP) reporting to the ATO.

Crucially, many employers have not historically reported OTE as part of STP. It was acceptable to report “superannuation liability”, being the amount of super calculated by the employer to be due on OTE, or in accordance with contractual obligations or those arising under industrial agreements, if there was a difference.

Everything that currently falls into OTE will remain part of QE, alongside commissions, board fees and other deemed wages such as payments for labour.

The new requirement to report, along with the more detailed disclosures to the ATO within STP2, will give the ATO far better visibility of positions being taken and data to make assessments. This greater visibility forms a key part of the platform for Payday Super, with the intent of saving employees the effort of validating their super and making it far simpler for the ATO to do this and generate assessments.

Therefore, attention to what is being reported to the ATO as QE becomes an important part of the risk management process for payrolls from 1 July 2026.

Most payroll systems are automated to the point that it may be unclear exactly what is being reported to the ATO in each field. Depending on how STP validation reports are presented and reviewed, it may not be obvious whether OTE is currently being reported. Therefore interrogating and understanding this data is an important part of the preparation process.

In anticipation of Payday Super, more complex payrolls should be considering ongoing review processes to enable the calculation and reporting of QE to be validated and cross-checked to SG, noting the variations that can arise from the interaction of salary sacrifice and more generous contractual arrangements.

The need to report deemed wages also emphasises the need for good processes to link accounts payable data (contractor payments) to the payroll in a timely manner.

Now is the time to review payroll configuration, outputs and the review process before penalties escalate and to ensure a clean history going into the new regime.