Super Changes Ahead: Introducing “Qualifying Earnings”
Important changes are coming to how employers calculate superannuation. From 1 July, the ATO will introduce a new calculation method
called qualifying earnings (QE). This change supports the rollout of Payday Super and is designed to improve accuracy and transparency
in super reporting.
What is qualifying earnings?
Qualifying earnings is a broader measure than the current ordinary time earnings (OTE) used to calculate super. Under the new rules,
super contributions will be calculated as 12% of qualifying earnings.
Qualifying earnings include:
Ordinary time earnings
Commissions
Salary sacrifice contributions
Certain other payments, including amounts paid to some extended‑definition employees, such as eligible independent contractors
While QE is broader than OTE, for many employers the actual amount of super paid may not change. However, how earnings are classified
and reported may need to be reviewed.
What does this mean for employers?
From 1 July, employers will:
Calculate super based on qualifying earnings, not OTE
Pay super at 12% of QE
Report year‑to‑date qualifying earnings and super liability each payday via Single Touch Payroll (STP)
To be ready, employers should:
Review payroll and pay codes to ensure earnings are correctly mapped
Confirm their payroll software can support qualifying earnings reporting
Work with their software provider or adviser to prepare for system updates
Why is this changing?
These changes form part of the ATO’s transition to Payday Super, where super is paid and reported at the same time as wages. Using
qualifying earnings creates consistency between what is paid, reported, and eventually received by employees.
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