1. What is 13th Month Pay?

The 13th month pay is a mandatory benefit in the Philippines equivalent to one-twelfth (1/12) of an employee's total basic salary earned within a calendar year. It is given to all rank-and-file employees regardless of their employment status.

2. How to Calculate 13th Month Pay

The standard calculation for 13th month pay is:

Where:

• Total Basic Salary — The sum of all basic salary earned during the calendar year (excluding allowances, bonuses, etc.)

Example: If an employee earned ₱240,000 in basic salary for the year, their 13th month pay would be ₱20,000 (₱240,000 ÷ 12).

3. Legal Basis in the Philippines

Presidential Decree No. 851 requires all employers to pay their rank-and-file employees a 13th month pay not later than December 24 of each year. The payment must be at least 1/12 of the total basic salary earned during the year.

4. Using the Calculator

Instructions: Simply enter the employee's total basic salary for the year in Philippine Pesos (PHP) and the calculator will compute the 13th month pay amount.

5. Frequently Asked Questions (FAQ)

Q1: Who is entitled to 13th month pay?
A: All rank-and-file employees in the private sector who have worked for at least one month during the calendar year.

Q2: When should 13th month pay be given?
A: The full amount should be given by December 24, though employers may give it in installments (with full payment by December 24).

Q3: Is 13th month pay taxable?
A: Amounts up to ₱90,000 are tax-exempt under Philippine law.

Q4: What if the employee worked less than a full year?
A: The calculation is prorated based on months worked (total basic salary earned ÷ 12).

Q5: Are bonuses included in basic salary?
A: No, only the basic salary is used in the calculation - bonuses, allowances, and other benefits are excluded.