13th Month Pay Calculator

13th month pay is an additional month of salary paid to employees as a mandatory year-end bonus. It is calculated as the total basic salary earned during the calendar year divided by 12. It is required by law in the Philippines (Presidential Decree 851), most Latin American countries, and some European nations. All rank-and-file employees who have worked at least one month during the year are entitled to it.

For employees who did not work the full calendar year, the 13th month pay is prorated. The formula is: (Monthly Salary x Months Worked) / 12. If you started in July and your monthly salary is 30,000, your 13th month pay would be (30,000 x 6) / 12 = 15,000. This applies to both new hires and employees who resigned mid-year.

In the Philippines, the first 90,000 of 13th month pay and other benefits combined is tax-exempt under the TRAIN law. Any amount exceeding 90,000 is subject to income tax. For most employees earning under 90,000 per month, the 13th month pay is completely tax-free.

In the Philippines, employers must pay the 13th month pay on or before December 24 of each year. Some companies pay half in June and half in December. The bonus must cover the period from January 1 to December 31 (or the employee's actual employment period within that year).

Under Philippine law, only basic salary is included in the 13th month pay computation. Regular allowances (transportation, meal, rice subsidies) are generally excluded unless they are part of the basic pay structure. Overtime pay, holiday pay, and performance bonuses are also excluded. Some companies voluntarily include allowances as a benefit.

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