From 1 July 2026, the Maximum Superannuation Contribution Base (MSCB) is calculated on an annual basis rather than quarterly. This change aligns with the Payday Super legislation and ensures super guarantee (SG) liability is accurately capped over the financial year.

The MSCB is the maximum amount of an employee’s Qualifying Earnings on which you are required to pay the SG in a financial year. If an employee’s Qualifying Earnings exceed the MSCB for the year, no SG is owed on the excess.

The MSCB configuration has also moved from a support-managed setting to Organisation Settings, where it can be managed directly by administrators. The setting is now date-driven at both the organisation and employee level, allowing you to manage when capping takes effect rather than simply toggling it on or off. Individual employees can be configured to override the organisation-wide default, providing flexibility for executive arrangements and other special employment contracts.

Before 1 July 2026, the MSCB was applied quarterly, the cap reset every three months, and SG was owed on earnings up to the quarterly threshold in each quarter. From 1 July 2026, the cap operates on a financial year basis. Qualifying Earnings are tracked cumulatively from 1 July each year, and SG ceases once an employee’s year-to-date Qualifying Earnings reach the annual cap.

The cap configuration has moved from support settings into Organisation Settings, where administrators with the right permission can manage it directly without raising a support request. The setting is now date-driven at both the organisation and employee level, consistent with how other super settings are managed in Definitiv. Employee-level overrides are available for the first time, allowing individual employees to be exempt from capping or to have capping applied regardless of the organisation-wide default.

Definitiv calculates the annual MSCB dynamically each financial year using the ATO’s formula:

Concessional Contributions Cap x 100 / SG Rate

The concessional contributions cap and the SG rate are updated in Definitiv at the start of each financial year and applied automatically. You do not need to manually enter the cap amount. Cap calculations are based on the Payment Date.

Access to the MSCB configuration is controlled by a new Manage Super Guarantee Capping permission. This permission gates both the organisation-level capping panel in Organisation Settings and the employee-level override option on individual employee records.

By default, the System Administrator role has this permission enabled. To update which roles can access these settings, navigate to Roles and Permissions in your organisation configuration.

The organisation-level MSCB capping setting is located in the Payroll tab of Organisation Settings, under the Maximum Super Contribution Base panel.

The setting is date-driven - rather than a single on/off toggle, you manage a list of capping rows, each with a commencement date, a cease date, and a checkbox indicating whether capping is enabled for that period. This allows you to schedule capping changes in advance and maintain a clear history of when the setting has been active.

To add a new capping configuration:

To remove an existing configuration, use the delete button on the relevant row. Changes take effect based on the commencement and cease dates you set, not immediately on save.

Individual employees can be configured to override the organisation-wide default. The employee’s setting inherits from the organisation default when their record is first created - if capping is enabled at the organisation level for the relevant period, the employee defaults to capping enabled, and vice versa.

Administrators can manually override individual employees to go against the organisation default. Common scenarios include:

Employee-level overrides follow the same date-driven pattern as the organisation setting. Each override has a commencement date and cease date, giving you precise control over when an individual employee’s setting takes effect.

To add or update an employee-level override:

The employee workbook has been updated to include the MSCB capping override fields, including the effective date. You can configure or update capping settings for multiple employees at once by exporting the workbook, updating the relevant columns, and importing it back. Rows with blank MSCB columns will not overwrite existing employee settings.

Once capping is active for an employee, Definitiv tracks their cumulative Qualifying Earnings against the annual MSCB threshold throughout the financial year.

When an employee’s year-to-date Qualifying Earnings reach 90% of the annual MSCB cap, a warning message is displayed in the Messages tab of the pay run. The message identifies the employee, shows their current year-to-date Qualifying Earnings total, and shows the remaining headroom before the cap is reached. This gives you advance notice to plan for the change in super liability before the cap takes effect.

Once an employee’s cumulative Qualifying Earnings reach the annual MSCB, Definitiv stops calculating SG on any further earnings for the remainder of the financial year. A message is generated in the Messages tab confirming the cap has been reached - for example: “Employee has reached the Maximum Contribution Super paid of $270,830.00 for 1 July 2026 - 30 June 2027.”

If the cap is reached mid-pay-run - where an employee’s Qualifying Earnings in a single pay run span both below and above the threshold - SG is calculated only on the portion up to the cap. The excess is not subject to SG.

Each year on 1 July, the cumulative Qualifying Earnings tracker resets to $0.00 and the cap recalculates based on the updated concessional contributions cap and SG rate for the new financial year.

Q. Does my organisation need to do anything for the quarterly-to-annual transition?
A. No manual action is required for the cutover. If your organisation was using the MSCB cap under the previous quarterly system, Definitiv will automatically migrate to the annual calculation from 1 July 2026. Historical pay runs processed before that date continue to reflect the quarterly calculation and are not affected. If you reprocess a historical pay run with a Payment Date before 1 July 2026, the quarterly cap logic is applied automatically.

Q. What is the MSCB cap amount for FY2026-27?
A. The MSCB for FY2026-27 is $270,830. This is calculated automatically by Definitiv using the concessional contributions cap of $32,500 and the SG rate of 12%. You do not need to set the cap amount manually.

Q. If I change the organisation-wide default, will it affect employees I have already set up individually?
A. No, employees with a manually configured override retain their individual setting regardless of changes to the organisation default. Only employees without an override will reflect the updated default.

Q. What if an employee has multiple profiles in Definitiv?
A. The cap applies independently to each employee profile. Qualifying Earnings across separate profiles are not aggregated for the purposes of the MSCB.

Q. Can I see a history of MSCB configuration changes?
A. Yes, all changes to the organisation-level and employee-level capping settings are recorded in the audit trail, including the date, time, and the user who made the change. The audit trail is read-only and cannot be modified.

Q. Will the MSCB cap affect how Qualifying Earnings are calculated?
A. No, the MSCB cap does not change how Qualifying Earnings are calculated - it controls the maximum amount of Qualifying Earnings on which SG is owed. The Qualifying Earnings calculation itself is determined by the pay item configuration described in the Qualifying Earnings Setup and User Guide.