What Is Super and How Does It Work?

What is superannuation?

Superannuation ("super") is money set aside during your working life to fund your retirement. Instead of receiving all of your income as take-home pay, a portion is paid into a super fund on your behalf, where it's invested and grows over time until you're eligible to access it.

The Super Guarantee (SG)

Most employees are entitled to compulsory super contributions from their employer, called the Super Guarantee. The current SG rate is 12% of your ordinary time earnings (or "qualifying earnings" under the new Payday Super rules — see below), and it's paid on top of your salary, not deducted from it.

The SG rate has increased gradually over recent years: 9.5% (2020-21) → 10% (2021-22) → 10.5% (2022-23) → 11% (2023-24) → 11.5% (2024-25) → 12% (2025-26 and 2026-27, where it now remains).

Payday Super: what changed from 1 July 2026

Payday Super is now law and in effect. Previously, employers only had to pay your super quarterly. Now, employers must pay your super guarantee on every payday, with the contribution required to reach your super fund within 7 business days of that payday.

The SG rate itself is unchanged at 12% — only the timing changed.
A new term, "qualifying earnings," replaces "ordinary time earnings" as the basis for calculating your super — it's a broader measure that captures more of what you're paid, including salary sacrifice amounts.
This is designed to reduce unpaid and underpaid super, since underpayments are now visible to the ATO in near real-time rather than only being caught up to a year later.

Reading your payslip

Your payslip should show the super contribution your employer is making on your behalf for that pay period, separate from your take-home pay. If you don't see a super line on your payslip, or the amount looks wrong, that's worth following up directly with your employer or checking your super fund's records.

The maximum contribution base

There's a cap on how much of your earnings your employer has to pay super on. For 2026-27, this is $270,830 per year (moved to an annual figure under Payday Super, rather than the previous quarterly cap). Above this, your employer isn't required to pay SG on the excess, though some may choose to.

See your own employer's super contribution Use the Superannuation Calculator →

Who doesn't get automatic super?

Sole traders and other self-employed people don't receive employer SG contributions — since there's no employer. If that's you, contributing to your own super is entirely voluntary, though personal contributions can often be claimed as a tax deduction.

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General information only. Consult a tax professional for your specific situation.