How to prepare for Payday Super: Qualifying Earnings (QE) and Annual Maximum Contribution Base (MCB)

Before the 1 July 2026 effective date, perform these audits to ensure your data is ready for the new system logic.

1. Review MCB overrides: Export your employee data now to identify any employees with "Custom" or "Non-default" Quarterly MCB settings. You will need to review these for the new annual rules.
2. Identify industrial super: Audit your pay categories. Identify which ones pay super on overtime or other industrial super so you are ready to apply the "Exclude from QE" flag once it is released.
3. Check under-18s: Identify employees under 18 who are on non-weekly pay cycles, as these will require manual QE verification in the new system.

Under the new legislation, the "Ordinary Time Earnings" (OTE) model will be replaced by the Qualifying Earnings (QE) framework. QE will be the official base used for calculating super guarantee obligations and will be reported to the ATO. We are designing the system to determine QE status automatically where possible:

• Automatic classification: Any pay category with a Super Rate > 0% will automatically be classified as Qualifying Earnings.
• Automatic exclusion: Any pay category with a Super Rate of 0% will be excluded from QE.
• The "Industrial Super" exception: For scenarios where you pay super on overtime due to an Award or Enterprise Agreement, those earnings are not considered QE by the ATO. We are adding an Exclude from qualifying earnings checkbox to pay categories. Ticking this will ensure the super is calculated but not reported as QE.

The current quarterly earnings cap is being abolished and will be replaced by a single Annual Cap of $270,830 starting 1 July 2026.

• Automated capping: The system will track cumulative QE across the financial year. Once an employee reaches the threshold, Super Guarantee (SG) contributions will automatically stop.
• Dual visibility: During the transition period, you will see both Quarterly MCB and Annual MCB fields in Pay Run Defaults and Pay Rate Templates.
• Banner warnings: We are adding clear banners to remind you that quarterly fields apply only to earnings processed before 1 July 2026.
• Pay run logic: When an employee hits the cap, the system will display a note in the pay run: "The maximum annual super contributions base has been reached and SG amounts have been adjusted accordingly".

A critical aspect of the transition is the "Date Paid" Rule. The obligation is triggered by the actual date the payment is made, not the period in which the work was performed.

The 30-hour weekly threshold for employees under 18 remains in effect. However, the new framework requires specific QE reporting that can be complex for non-weekly pay runs:

• Weekly pay runs: The system will automatically determine if the 30-hour threshold was met.
• Non-weekly pay runs (Fortnightly/Monthly): We are introducing a QE Override Field within the pay run.
• Admin action: You will be able to manually enter the correct QE figure for these employees to ensure your STP reporting remains compliant with the new Payday Super requirements.

• Report renaming: We are renaming the existing OTE Report to the OTE/QE Report. A new QE column will be added for all pay runs paid on or after 1 July 2026.
• New STP codes: STP submissions for pay runs dated 1 July 2026 onwards will automatically include both Code Q (Qualifying Earnings) and Code L (Super Liability).
• API endpoints: We are updating our API for Employees and Pay Rate Templates to accept and return both maximumQuarterlySuperContributionsBase and the new maximumAnnualSuperContributionsBase fields.