13th Month Pay Calculator

13th month pay guide

How 13th month pay is computed

Presidential Decree 851 requires private-sector employers to give rank-and-file employees a 13th month pay. It equals one-twelfth of the basic salary you actually earned during the calendar year:

If you earned the same salary all year, that is simply one month's basic salary. If you joined mid-year, left, had unpaid absences, or got a raise, you need to add up what you actually earned.

Worked examples

For a year with a salary change, enter your average monthly basic salary in the calculator. In the fourth example, that's ₱19,000.

What counts as basic salary

Basic salary is the pay for your regular work. It's the amount on your contract, minus unpaid absences and tardiness. Under the revised PD 851 implementing guidelines, these are not included unless your employer treats them as part of basic pay by agreement or long-standing practice:

• Overtime pay, premium pay for rest days and holidays, and night differential
• Holiday pay
• Cost-of-living allowance (COLA) and other allowances
• Cash conversion of unused vacation and sick leave
• Profit-sharing and other bonuses

Sales commissions are the grey area. If they are part of your wage structure, courts have included them in some cases. Check your company's practice.

Who is entitled

All rank-and-file employees in the private sector who worked for at least one month during the calendar year are entitled. That applies whatever their position, employment status (probationary, regular, contractual, or project-based), or how they're paid (monthly, daily, or piece rate). PD 851 doesn't cover:

• Government employees, who receive a year-end bonus under separate rules
• Managerial employees, although many companies still give them a 13th month by policy
• Employers that already pay an equivalent benefit of at least the same amount

When it must be paid

The deadline is 24 December each year. Employers can split it, for example half before the school year opens and the rest before 24 December. If you resign or are separated during the year, your pro-rated 13th month pay is part of your final pay. DOLE Labor Advisory No. 06, Series of 2020 says final pay should be released within 30 days from separation.

Is 13th month pay taxable?

Only above ₱90,000. The TRAIN Law (Republic Act 10963) exempts your 13th month pay and other benefits, such as a Christmas bonus or productivity incentive, up to a combined ₱90,000 a year. Anything above that is added to your taxable compensation.

The ₱90,000 limit covers the combined total of these benefits, so the calculator's tax note only considers the 13th month pay itself. Add any bonuses yourself to check the limit.