Official DOLE 13th Month Pay Formula
Under DOLE Labor Guidelines and Presidential Decree No. 851, the 13th month pay is computed as follows:
$$ ext{13th Month Pay} = rac{ ext{Total Basic Salary Earned within the Calendar Year}}{12}$$
The ₱90,000 Tax-Exempt Bonus Ceiling
Under Section 32(B)(7)(e) of the National Internal Revenue Code (as amended by Republic Act No. 10963), total 13th month pay and other benefits up to ₱90,000 are exempt from withholding income tax. Any amount in excess of ₱90,000 is added to taxable income.