From 1 July 2026, a major shift in how employers manage superannuation will take effect across Australia. Known as Payday Super, this reform will require employers to pay employees super at the same time as their wages rather than quarterly.

The Australian Taxation Office will oversee this new system, which aims to reduce unpaid super, improve transparency and help employees build their retirement savings sooner. While this change benefits employees, it will also significantly affect how businesses handle payroll and manage cash flow.

Here is what you need to know.

What is Payday Super

Currently, employers must pay Superannuation Guarantee contributions at least quarterly. Many businesses choose to do so after the end of each quarter, rather than with every pay cycle.

From 1 July 2026, the new Payday Super rules will require employers to:

• Pay super at the same time as salary and wages
• Ensure contributions reach the employee's super fund within seven business days of payday
• Calculate super based on qualifying earnings, which combines ordinary time earnings with other eligible payments

Why the Government is Introducing Payday Super

The government is introducing Payday Super to address ongoing issues with unpaid or late super contributions. Each year, billions of dollars in super go unpaid, leaving workers without their full entitlements.

Key objectives of the reform include:

1. Reducing unpaid super by allowing the ATO to detect missed contributions sooner
2. Improving retirement outcomes as super begins earning investment returns earlier
3. Increasing transparency so employees can see their super paid alongside their wages
4. Strengthening compliance through closer reporting links between payroll and superannuation data

How Payday Super Will Affect Employers

This change affects the timing of payments rather than the amount of super paid. Depending on how often employees are paid, super will need to be paid on the same schedule. Employers who pay weekly, fortnightly or monthly will need to make corresponding super contributions.

Businesses should review their payroll systems and processes to ensure they can meet the new timing requirements. This may include upgrading payroll software, checking clearing house arrangements, confirming data accuracy and reviewing cash flow management.

For smaller employers, paying super more frequently could impact short-term cash flow, so planning ahead will be important.

What Happens If Super Is Paid Late

If super is not paid on time, the Superannuation Guarantee Charge may apply. This charge includes the outstanding super, accrued interest and possible administrative penalties.

With the ATO gaining greater visibility through real-time reporting, late payments may be detected sooner than before. Ensuring compliance will therefore be more important than ever.

What Employers Can Do Now

Although Payday Super begins on 1 July 2026, employers should begin preparing early. Key steps include:

1. Reviewing payroll systems to confirm software readiness
2. Aligning super payments with the existing pay cycle
3. Updating cash flow projections to include more frequent super contributions
4. Consulting an accountant or payroll adviser for guidance on compliance

Final Thoughts

Payday Super is one of the most significant changes to superannuation in recent years. It aims to make the system fairer, more transparent and more efficient for both employers and employees.

With the start date approaching, now is the ideal time for businesses to review payroll processes, assess system readiness and prepare for the transition to Payday Super.

At Diwan & Co., we can help your business prepare for Payday Super — from reviewing payroll processes to ensuring your compliance obligations are met ahead of the 1 July 2026 deadline.

If you are starting a business or seeing your income grow, one of the most common questions is whether you need to register for GST. Knowing when to register helps ensure your business stays compliant and avoids unnecessary tax issues.

What Is GST

GST is a ten per cent tax applied to most goods and services sold in Australia. Businesses that are registered for GST are generally required to:

• Charge ten per cent GST on taxable sales
• Collect GST from customers
• Report GST to the Australian Taxation Office through Business Activity Statements (BAS)
• Claim GST credits for the GST included in business expenses

Although GST is collected from customers at the point of sale, it is the business owner's responsibility to report and remit the tax to the ATO.

When You Need to Register for GST

The main factor that determines whether you need to register for GST is your annual GST turnover. You must register if your business turnover reaches, or is expected to reach, $75,000 or more in a financial year. Non-profit organisations must register when their turnover reaches $150,000 or more.

If your business passes the threshold, you must complete your GST registration within twenty-one days. Remember that GST turnover means total business income, not profit.

Special Rules for Ride Sourcing and Taxi Operators

If you operate a taxi, limousine, or ride sourcing service such as Uber, you must register for GST regardless of your turnover. This requirement applies even if you earn under $75,000 a year.

What Counts Toward GST Turnover

Your GST turnover includes most income earned from business activities. This may include sales of goods, fees for services, consulting income, online sales, and professional services.

However, some amounts are excluded when calculating GST turnover:

• GST-free sales
• Input taxed sales such as residential rent
• Sales of capital assets like equipment
• Sales that are not connected with Australia

If your business is approaching the registration threshold, it is a good idea to review your turnover regularly to stay compliant.

Voluntary GST Registration

Even if your business earns less than $75,000 a year, you can choose to register voluntarily. This may benefit you if:

• Your business incurs significant expenses and you want to claim GST credits
• Your clients are also GST registered
• You want your business to appear more established professionally

Once you have registered, you must charge GST on taxable sales, report through BAS, and maintain appropriate business records. For some small businesses, the added compliance may outweigh the benefits of registering early.

What Happens After You Register

Once registered for GST, your business will need to:

• Add ten per cent GST to taxable sales where applicable
• Provide tax invoices when customers request them for purchases over $82.50 including GST
• Lodge Business Activity Statements, usually every quarter, though some businesses report monthly

Your BAS will include GST collected from customers, GST paid on business purchases, and the final amount payable or refundable.

What If You Do Not Register When Required

If your business exceeds the GST threshold and you do not register, the ATO may require you to pay GST on past sales, along with interest and possible penalties. You may also need to correct previous tax reporting.

In some cases, this means paying GST out of your own funds if you did not charge it to customers at the time of sale.

If you are unsure whether you need to register, or if you need help managing BAS and GST obligations, our team at Diwan & Co. can guide you through the process with clarity and confidence.

For many Australian businesses, the Instant Asset Write Off has been one of the most useful tax incentives available in recent years. It allows eligible businesses to claim an immediate tax deduction for the cost of certain assets, rather than depreciating them over several years.

If you are planning to invest in new equipment, vehicles or technology, understanding how the Instant Asset Write Off works can help you make better business decisions and manage your cash flow more effectively.

What Is the Instant Asset Write Off

The Instant Asset Write Off is a government initiative that allows eligible businesses to claim an immediate deduction for the cost of eligible assets used for business purposes. Instead of spreading the deduction over the life of the asset, you can claim the expense in the same financial year the asset is first used or installed ready for use.

This can provide a valuable boost to cash flow by reducing your business's taxable income for that year.

Eligibility Criteria

To claim the Instant Asset Write Off, your business must meet specific eligibility criteria set by the Australian Taxation Office. These include:

• Your business must have an aggregated turnover below the threshold set for the financial year
• The asset must cost less than the current threshold amount for immediate deduction
• The asset must be used or installed ready for use within the relevant financial year

Eligibility requirements and thresholds can change between financial years, so it is important to check the latest ATO guidelines or speak to a tax professional for current information.

What Assets Can Be Claimed

Eligible assets can include new or second-hand items such as office furniture, computer equipment, tools, machinery, vehicles and technology used in daily business operations.

You cannot usually claim assets that are leased, already written off under another scheme, or fall outside the threshold limit for that year. For vehicles, deductions may also be subject to the car limit set by the ATO.

How It Benefits Your Business

The Instant Asset Write Off offers several potential benefits including:

• Improved cash flow through faster tax deductions
• Encouragement to reinvest in your business with updated tools or technology
• Simplified record keeping compared to long-term depreciation schedules

For example, if you purchase new office equipment that meets the criteria and costs less than the set threshold, you may be able to claim the full cost as a deduction in that year instead of over several years of depreciation.

Timing and Planning Considerations

Because eligibility depends on timing, it is important to ensure your asset is both purchased and ready for use within the relevant financial year. This timing determines whether the business can claim the deduction under that year's rules.

Planning asset purchases before the end of the financial year can help you take advantage of the available write off while managing cash flow efficiently.

At Diwan & Co., we can help you plan asset purchases strategically, structure your deductions correctly, and ensure you are making the most of the incentives available to your business.

Choosing the right business structure is an important decision for any Australian business owner. It can affect how you are taxed, your personal risk, and how easy it is to grow or sell your business in the future.

This guide outlines the key differences between operating as a sole trader and running a company, to help you have a more informed conversation with your adviser.

Sole Trader and Company at a Glance

Sole trader — An individual who owns and runs the business in their own name. You and the business are legally the same entity.

Company — A separate legal entity registered with the relevant authorities. It is distinct from its owners and has its own obligations and reporting requirements.

Key Differences

Control and decision making

As a sole trader, you make all decisions yourself and have complete control over the business. This can make it easier and faster to make changes. In a company, decisions are made by directors and, in some cases, influenced by shareholders. Even if you are the only director, you will have additional formal responsibilities and record keeping requirements.

Setup and ongoing costs

Sole trader structures are generally quicker and less expensive to set up and maintain. You typically need an Australian Business Number and, if you choose, a registered business name and business bank account. Companies are more complex and usually cost more to establish and run, with obligations including company registration, maintaining records and meeting annual reporting requirements.

Tax treatment

As a sole trader, business income is taxed in your personal name at individual income tax rates. Your business profits are added to your other personal income, such as wages or investment income. A company pays tax on its profits at the applicable company tax rate. Money you take out of the company may be paid as wages, director fees or dividends, each with its own tax treatment.

Liability and asset protection

Sole traders are personally responsible for business debts and liabilities, meaning your personal assets may be at risk if the business cannot meet its debts. A company offers a degree of separation between the business and its owners. However, company directors still have important legal duties and, in some circumstances, can be personally liable for certain debts and obligations.

Growth and investment

A sole trader structure can be suitable for freelancers, consultants and small businesses. It is generally easier to manage but can be harder to scale or bring in new owners. Companies can make it easier to add new shareholders, attract investors, or bring in business partners — which can be helpful if you plan to grow, raise capital or eventually sell the business.

Record keeping and compliance

Sole traders usually have simpler reporting requirements, with business income and expenses included in your individual tax return. Companies have more formal obligations, including preparing financial records, lodging separate tax returns, and meeting company law requirements such as maintaining registers and documenting key decisions.

Which Structure Might Suit You

A sole trader structure may suit you if:

• You are starting small, want a simple structure and low setup costs
• You want full control over decisions
• You are comfortable with personal responsibility for business debts

A company structure may be worth considering if:

• You are planning to grow or bring in partners or investors
• You want a structure that separates the business as a distinct legal entity
• You are prepared to manage higher compliance and reporting obligations

Before deciding, it is important to consider your business goals, risk tolerance, personal circumstances and plans for the future.

At Diwan & Co., we can help you understand your options and choose a structure that supports your business goals both now and into the future.

Effective tax planning can help small businesses in Australia manage cash flow, stay compliant and make better decisions throughout the year rather than just at tax time. This overview outlines some practical areas to discuss with your adviser when planning for year end and beyond.

Understanding Your Business Structure

Your business structure affects how your profits are taxed and what records you need to keep. Common structures include sole trader, partnership, company and trust. Each structure has different tax rates, reporting obligations and levels of personal liability.

If your business has changed or grown, it may be worth reviewing whether your current structure still suits your goals and risk profile. Any changes should be carefully planned with professional advice.

Keeping Good Records All Year

Accurate, up-to-date records make tax time much easier and reduce the risk of errors. This includes keeping invoices, receipts, bank statements and payroll records in an orderly system. Using accounting software that links to your bank account can help track income and expenses in real time. Good record keeping also supports your ability to substantiate deductions if the ATO asks for more information.

Maximising Legitimate Deductions

Small businesses can generally claim deductions for expenses that are directly related to earning assessable income. Common examples include:

• Operating costs such as rent, utilities, business insurance and professional fees
• Office supplies and a business portion of phone and internet
• A business portion of home office costs and motor vehicle expenses
• Depreciation on equipment used in the business

The rules can be detailed, so it is important to keep clear records and seek advice where needed.

Timing Income and Expenses

Managing when income is derived and when expenses are incurred can influence your taxable income for a particular year. For example, in some situations you may be able to bring forward deductible expenses, or delay issuing certain invoices until the next financial year.

These decisions should always be made with consideration of cash flow, upcoming obligations and your broader business plans — not just tax outcomes. It is important that any timing strategies are consistent with tax law and commercial reality.

Superannuation Contributions

Superannuation is an important part of tax planning for both business owners and their employees. Employer super contributions are generally deductible to the business if paid on time and in accordance with superannuation rules.

Some business owners may also consider making additional personal or salary sacrificed contributions, within contribution caps, as part of their longer-term retirement and tax planning. The rules around contributions and caps change from time to time, so up-to-date advice is essential.

Using Small Business Concessions

The Australian tax system offers various concessions for eligible small businesses, such as simplified depreciation rules and concessions related to capital gains when selling certain business assets. These concessions can affect how and when you acquire or dispose of assets, or how you structure a sale of the business.

Eligibility often depends on your aggregated turnover and other conditions, so it is important to confirm that your business qualifies before relying on any concession.

Planning for GST and PAYG

If your business is registered for GST, planning for activity statements throughout the year is important to avoid unexpected liabilities. This includes setting aside funds for GST, Pay As You Go instalments and withholding obligations for employees.

Regularly reconciling your accounts and reviewing your BAS figures can help you identify issues early, rather than waiting until year end.

At Diwan & Co., we can help you align your tax planning with your broader business strategy, including succession planning, asset protection and long-term growth goals. Reach out to our team to get started before year end.

Classifying a worker correctly as an employee or a contractor is essential for Australian businesses. It affects tax, superannuation, leave entitlements and your legal obligations, and getting it wrong can lead to costly penalties and back payments.

Understanding the Difference

An employee generally works in and forms part of your business, following your direction about how, where and when work is done. A contractor is usually running their own business, providing services to yours, often with more control over how the work is delivered.

Simply calling someone a contractor, or having a contract that uses that term, does not make them one in law. The actual working relationship and the terms of the agreement are what matter when authorities such as the ATO or Fair Work assess the arrangement.

Key Factors Authorities Consider

When working out if a worker is an employee or a contractor, no single factor decides the outcome. A range of indicators are considered together, including the following.

Control over work

If you decide the hours, location, and way the work is done, this points toward an employment relationship. If the worker has greater freedom to decide how the work is carried out and manages their own schedule, this may suggest a contracting arrangement.

Ability to delegate

Employees usually perform the work themselves and cannot pay someone else to do it for them. Contractors can often delegate or subcontract work to others, depending on the terms of the contract.

Tools, equipment and expenses

Employees are commonly provided with the main tools, equipment and resources they need, or are reimbursed for associated costs. Contractors are more likely to supply and maintain their own equipment and factor those costs into their fees.

Risk and opportunity for profit

Employees have limited financial risk and are paid a wage or salary, often with leave and other entitlements. Contractors typically bear more risk — for example, needing to fix errors at their own cost — and can have the potential to make a profit or a loss from a job.

Integration into your business

An employee usually works as part of the ongoing operations and represents your business to clients. A contractor is more likely to operate as an external service provider who may work for multiple clients.

Tax and Super Obligations

If a worker is an employee, you are generally required to withhold tax from their wages, pay superannuation guarantee, provide pay slips, and meet Fair Work obligations including minimum pay rates and, where applicable, leave entitlements.

Contractors usually manage their own tax affairs and may need an Australian Business Number and their own registrations. However, for some contractors who work in an employee-like way, you may still have superannuation obligations, so it is important to check the specific rules that apply.

Sham Contracting Risks

Sham contracting occurs when a business treats someone as a contractor when they are in fact an employee at law. This can arise where an employee is asked to get an ABN or sign a contractor agreement, even though the working relationship is essentially that of employment.

Sham contracting is unlawful and can result in significant penalties, orders to back pay entitlements and compensation. Australian courts and regulators can look beyond labels in a contract and examine the real nature of the relationship.

Practical Steps for Employers

To reduce risk and support compliance, employers should consider the following:

• Clarify roles before hiring — Think carefully about the nature of the work, how much control you require, and whether you expect the worker to operate as part of your business or in their own right
• Use clear, accurate agreements — Ensure contracts accurately reflect the agreed relationship and day-to-day reality. Avoid using standard contractor agreements for roles that function like employment
• Review existing contractor arrangements — For current contractors, review factors such as control, delegation, equipment, risk and integration. If arrangements have shifted over time, it may be necessary to update the classification
• Seek professional advice — Because the rules are detailed and can differ across tax, super, employment law and workers compensation, obtain advice from a qualified professional before making decisions about worker classification

At Diwan & Co., we can help you review your worker arrangements, understand your obligations, and ensure your business is structured correctly from both a tax and compliance perspective.