Super Guarantee Hits 12% from 1 July 2025: What Employers Need to Do

From 1 July 2025, the Superannuation Guarantee (SG) rate will rise to 12%, completing its gradual increase from 9.5% in 2021.

If you employ staff, now’s the time to prepare your payroll, cashflow, and reporting to avoid underpayment risks and stay compliant.

What’s changing?

The SG rate is increasing from 11.5% to 12% on 1 July 2025. This applies to all eligible workers and is calculated on their ordinary time earnings (OTE).

This is the final step in the legislated SG rate increases under the Superannuation Guarantee (Administration) Act 1992.

From 1 July 2025:

• Any salary or wage payments made must include 12% SG
• Even if the work was done in June, the payment date determines the SG rate
• Employers must ensure payroll software is updated accordingly

What it means for your business

This might sound like a small increase—but across your team, it adds up quickly.

For example, an employee earning $100,000:

• At 11.5%, super = $11,500
• At 12%, super = $12,000
• That’s $500 more per year per employee.

Multiply that across 10+ staff, and it could significantly impact your cash flow—especially if super is paid quarterly.

Key compliance risks to avoid

If you underpay super (even by mistake), the ATO won’t just let it slide.

You may be liable for:

• The Superannuation Guarantee Charge (SGC)—which includes interest and admin fees
• Loss of deductibility on the missed payment
• Director penalty notices (DPNs) in serious cases

If your business operates on inclusive salary packages, you may need to update employment contracts to ensure you remain compliant without affecting net take-home pay.

What you need to do now

Here’s how to stay ahead of the change:

• Update payroll software settings to reflect 12% from 1 July 2025
• Review employment contracts—particularly if they state a “total remuneration package including super”
• Budget for increased SG payments starting next quarter
• Communicate the change to staff so there are no surprises
• Check your clearing house or super gateway is SG-ready

Super on Paid Parental Leave – A separate change

From 1 July 2025, the federal government will start paying super on Paid Parental Leave (PPL)—but this doesn’t affect employers directly.

• The 12% SG on PPL payments will be handled by Services Australia, not employers
• There’s no payroll obligation on your part
• It’s still a good idea to update employees who are planning to take leave

Link this change to your year-end planning

If you’re reviewing payroll or updating employee records before 30 June, it’s a good opportunity to:

• Adjust future super budgets
• Communicate upcoming SG changes
• Ensure systems are compliant for the next financial year

You can also download our handy tools:

• EOFY Checklist for Employers: STP, Super & Payroll
• Business Deductions Checklist

Frequently Asked Questions

‍

‍

Don’t get caught out this financial year

Small mistakes with super can lead to big problems.

Let’s make sure you’re ready. Speak with your RJS accountant today to review your payroll and plan ahead for the new SG rate.

‍