Superannuation guarantee (SG) compliance is one of the highest-stakes obligations a bookkeeper manages on behalf of employer clients. The ATO has made SG enforcement a sustained priority, its data-matching capabilities now extend directly to super fund records, and the consequences of non-compliance — through the Superannuation Guarantee Charge — are both financially severe and non-deductible.
Here is what bookkeepers need to get right in 2026.
The 2026 Rate and the Path to 12%
The SG rate for 2025-26 is 11.5% of ordinary time earnings. From 1 July 2026, it increases to 12% — the final step in the legislated schedule that began at 9.5% in 2014.
The rate change takes effect for any pay period that starts on or after 1 July 2026. For employers who pay monthly, the June pay period (paid in July) is usually at the new rate. For fortnightly payroll, the first full pay period starting after 1 July triggers the higher rate. Confirm the exact dates with your payroll software — payroll solutions should apply the rate change automatically, but verify that the update has occurred correctly in the first July payrun.
Ordinary Time Earnings: What's Included
The SG is calculated on ordinary time earnings (OTE), not total gross earnings. This distinction matters because some amounts paid to employees are excluded from OTE:
Included in OTE:
- Salary and wages for ordinary hours
- Over-award payments for ordinary hours
- Shift loadings (not overtime)
- Most allowances (with some exceptions)
- Annual leave loading
- Commission and bonuses paid in connection with ordinary hours worked
Excluded from OTE:
- Overtime payments (hours worked beyond ordinary hours)
- Payments that are not salary or wages (workers compensation, reimbursements)
- Certain work-related expenses
The overtime exclusion is commonly misapplied. If a Modern Award defines ordinary hours broadly and the employee regularly works those hours, what appears to be "overtime" on the payslip may actually be ordinary hours for SG purposes. This is an area where industry-specific award knowledge matters.
Quarterly Due Dates and the 28-Day Rule
SG contributions must be received by the employee's super fund by the 28th day after the end of each quarter:
- Q1 (July–September): due 28 October
- Q2 (October–December): due 28 January
- Q3 (January–March): due 28 April
- Q4 (April–June): due 28 July
"Received by the fund" is the operative phrase — not "paid by the employer." Payment processing between the employer's bank and the fund typically takes 1–3 business days. For monthly contributions (which must still arrive by the quarterly due date), this processing time is straightforward to accommodate. For employers who pay contributions infrequently or in bulk, the cut-off is less forgiving.
What Happens When SG Is Paid Late
If an employer fails to pay the required SG by the quarterly due date, the Superannuation Guarantee Charge (SGC) applies. The SGC is materially worse than simply paying the contribution late:
The SGC base is broader than the SG base. The SGC is calculated on total salary and wages, not just ordinary time earnings. An employee who earns a lot of overtime will have a lower SG base but a higher SGC base — meaning late payment is always more expensive.
The SGC is not deductible. SG contributions paid on time are a deductible expense. The SGC is not. This means the cost of late payment is 100% borne by the employer with no tax offset.
The SGC includes an interest component. The nominal interest rate under the SGC is 10% per annum, calculated from the start of the relevant quarter. An employer who is three months late faces interest accrued from the beginning of the quarter, not from the due date.
The SGC includes an administrative charge. A flat $20 per employee per quarter charge applies in addition to the interest component.
SGC liabilities must be lodged and paid to the ATO. Unlike SG contributions (which go directly to the fund), the SGC is paid to the ATO, which then remits the appropriate portion to the employee's fund.
SG Choice of Fund and Stapling
Since November 2021, employers must check the ATO's online portal to identify a "stapled fund" before adding a new employee to a default fund. If an employee has an existing super account (their stapled fund), contributions must go there unless the employee provides an active choice.
Failing to use the stapled fund is a compliance breach. The ATO's online portal (accessed via ATO Online Services for Business) identifies the stapled fund from the employee's TFN.
Bookkeeper Checklist for SG Compliance
- Confirm the SG rate in use — update to 12% from 1 July 2026 payrun
- Review OTE classification for each pay component (especially shift loadings vs overtime)
- Check contribution due dates against the quarterly calendar
- Confirm contributions are physically received by the fund — not just initiated
- Check new employee stapled fund status before defaulting to the employer's default fund
- Maintain records of contribution payments for at least five years
SG compliance is not a "close enough" area. The combination of non-deductible SGC, broad calculation base, and ATO data-matching means errors are both expensive and detectable. Regular, accurate payment is always preferable to catching up later.