How to pay super: Employer guide to superannuation in Australia
Australian businesses must pay superannuation for eligible employees. Learn the key steps and deadlines.
Written by Jotika Teli—Certified Public Accountant with 24 years of experience. Read Jotika's full bio
Published Friday 7 November 2025
Table of contents
Key takeaways
• Calculate superannuation contributions by multiplying each employee's ordinary time earnings (OTE) by the current super guarantee rate of 11.5% until 30 June 2025, then 12% from 1 July 2025.
• Pay all superannuation contributions electronically through SuperStream using payroll software, clearing houses, or direct fund portals, ensuring payments reach funds by quarterly deadlines (28th of October, January, April, and July).
• Collect essential fund details from employees including their chosen super fund's ABN, unique superannuation identifier (USI), and the employee's member number to ensure accurate payment processing.
• Avoid costly penalties by meeting quarterly payment deadlines, as late payments trigger super guarantee charges plus interest and are no longer tax deductible.
What superannuation means for you as an employer
Superannuation obligations require employers to contribute a percentage of each employee's earnings to their retirement fund. As an employer, you must pay super for all eligible staff and report these payments to the ATO.
When you meet your super obligations, you help your team’s financial future, stay compliant, and protect your business.
- build your team’s financial future
- avoid costly penalties and stay compliant with the Australian Taxation Office (ATO)
- prevent super guarantee charges for late payments
Understanding superannuation contributions
Superannuation eligibility applies to all employees regardless of earnings. You must pay super for:
Age requirements:
- Anyone over 18 years old
- Under 18s who work more than 30 hours per week, regardless of how much you pay them.
Employment types:
- Part-time and casual staff
- Temporary residents like backpackers
- Most independent contractors
- Staff on leave (including sick leave and long-service leave)
You pay these super contributions into each employee's chosen super fund or retirement savings account. The ATO monitors these payments, and you need to report to them how much you've paid.
Superannuation rates in Australia
Ordinary time earnings (OTE) includes regular wages, bonuses, and allowances but excludes overtime in most cases. Current super rates are:
- Until 30 June 2025: 11.5% of OTE
- From 1 July 2025: 12% of OTE
How much super you need to pay
The amount of super you pay is based on the super guarantee (SG) rate. This is a percentage of an employee's ordinary time earnings (OTE), which includes their regular wages plus things like commissions, shift loadings, and some allowances. It doesn't usually include overtime pay.
The SG rate is gradually increasing. Make sure you're using the correct rate for the pay period to calculate contributions accurately.
To work out the super contribution, you simply multiply your employee's OTE for the period by the current SG rate. For example, if an employee's OTE is $2,000 for the quarter and the SG rate is 11.5%, their super contribution is $2,000 x 11.5% = $230.
How to pay your employees' superannuation
Paying employee super involves four key steps that ensure accurate, compliant payments to the right funds. Here's how to manage super payments for your team:
1. Ask your employees to choose a super fund or retirement savings account
Employee choice is mandatory for super fund selection. Your responsibilities include:
- Offer options: Present super funds or retirement savings accounts (RSAs)
- Provide default: Use your default fund if employees don't choose
- Document choices: Keep records of employee fund selections
2. Check the super fund details
Fund setup accuracy prevents payment delays and errors. Collect these details for each employee:
- tax file number (TFN) – nine-digit identifier
- Australian business number (ABN) – 11-digit business identifier
- unique superannuation identifier (USI) – specific code for each super product
- super fund name – check spelling to avoid rejections
3. Calculate the superannuation amount
Multiply your employee's OTE by the super rate. For example, if their yearly OTE is $50,000 and the super rate is 11.5%, their super contribution is $50,000 x 11.5% = $5,750.
4. Make your super payments through SuperStream
SuperStream is the mandatory electronic system for all super payments in Australia. You have two payment options:
Manual approach:
- Pay through each super fund's online portal
- Requires separate logins and transactions
Automated approach:
- Use payroll software like Xero for streamlined payments
- Automatically calculates contributions and pays correct funds
- Includes STP (Single Touch Payroll) compliance reporting
Setting up super payments for your business
Before you can pay super, you need to collect the right information from your employees. Give each new employee a Superannuation standard choice form to fill out. This allows them to choose their own super fund.
If an employee doesn't choose a fund, you may need to check with the ATO if they have an existing 'stapled' super fund that is linked to them. If they don't have a stapled fund, you can then pay their contributions into your business's default super fund.
To make payments, you'll need the fund's ABN and unique superannuation identifier (USI), along with the employee's member number.
Payment methods and SuperStream requirements
You must pay all super contributions electronically through a system called SuperStream. This is the standard for sending both the payment and the data to the super fund.
You have a few options for meeting SuperStream requirements:
- Using a clearing house: You can make a single payment to a clearing house, which then distributes the money to each employee's fund. The ATO offers a free Small Business Superannuation Clearing House. A contribution is only considered 'paid' on the date it is received by the super fund, not the date it is received by the clearing house.
- Directly with the super fund: Some large super funds have online portals for employers, but this can be time-consuming if your employees use many different funds.
Super payment deadlines and timing
Super payment deadlines are quarterly and strictly enforced. Late payments trigger the super guarantee charge plus interest.
Quarterly payment schedule:
- 1st quarter (July-Sept): Due 28 October
- 2nd quarter (Oct-Dec): Due 28 January
- 3rd quarter (Jan-Mar): Due 28 April
- 4th quarter (Apr-June): Due 28 July
Some super funds require you to contribute monthly. Check each fund’s website for their requirements.
What happens if you miss a super payment
ATO monitoring tracks all super payments through STP reporting. Employees can report missing or incorrect payments directly to the ATO.
If you miss a payment:
- Pay immediately: Clear overdue contributions as soon as possible
- File SGC statement: Submit super guarantee charge paperwork to ATO
- Pay penalties: Cover missing amount plus SGC and interest charges. Crucially, these missed or late super payments are no longer tax deductible.
Simplify super payments with Xero
You can stay on top of your super obligations with Xero Payroll. Automate super calculations and make SuperStream-compliant payments easily. Xero Payroll helps you pay your team correctly and stay compliant, so you can focus on running your business. Try Xero for free.
FAQs on paying superannuation
Here are answers to common questions about employer superannuation rules.
What should I do if I've missed a payment deadline?
Pay the overdue superannuation as soon as you realise – including any interest – and report the late payment to the ATO. Once that's done, review your payroll processes to prevent stress and financial penalties next time. Think about payroll software like Xero to simplify your payroll.
Do I need to pay super for my casual employees?
Yes, you must pay super for all your staff, including casual employees and temporary residents like backpackers. There is no minimum earning threshold, as the previous $450 a month rule was removed on 1 July 2022.
Do I need to pay superannuation for contractors?
You must pay super for an independent contractor if you hire them mainly for their labour, such as for a fixed number of hours, rather than to achieve a specific result for a project.
Can I claim tax deductions on superannuation payments?
Yes, as long as you pay your super contributions on time, you can claim them as a tax deduction. Keep your pay records in order so you know exactly how much you have paid. Xero Payroll helps you organise all your financial data in one place.
What happens if I've lodged the wrong super fund amount?
If you have lodged a tax return with the wrong super fund, amount, or details, ask the ATO for an amendment as soon as possible to reduce any interest charges.
Disclaimer
Xero does not provide accounting, tax, business or legal advice. This guide has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the content provided.
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