About 31 per cent of SME owners say they are unsure of the implications of Payday Super laws, despite the reforms set to commence on July 1, according to MYOB research.
The reform requires employers to pay superannuation contributions alongside wages, rather than quarterly. While the total amount of superannuation guarantee payable does not change, the shift in timing may require some businesses to review payroll processes and cash flow management.
Paul Robson, CEO of MYOB, said the data shows the small business community is confident overall, with preparation before July remaining a focus.
“It’s encouraging to see that many small businesses expect Payday Super to have little or no impact, and some even see it as a positive change,” he said. “For those still getting across the details, the most important step is understanding how the timing change affects payroll and cash flow and making any adjustments early.”
Findings from MYOB’s Bi-Annual Business Monitor show that 51 per cent of SMEs expect Payday Super will not affect their operations, while 22 per cent expect a positive impact.
The data suggests some businesses may not have accounted for the operational changes involved, even where they support the reform in principle.
For business owners managing time and cash flow constraints, the change in payment timing may create pressure if payroll processes, cost approvals and budgets are not updated in advance.
MYOB recommends businesses begin preparing before the start date. Businesses should map current pay cycles to identify when superannuation contributions will be paid with wages.
They should also review cash flow to incorporate obligations into weekly, fortnightly or monthly payroll runs rather than at quarter-end. Payroll systems should be checked to ensure contributions can be calculated and paid during each pay cycle without manual processes.
This article was first published on sibling website Inside Small Business.
