Compute 13th month pay the PD 851 way — total basic salary earned in the calendar year divided by 12, prorated for partial years, less unpaid absences. Enter the monthly basic and months worked; the math updates instantly.
Mandated benefit — one-twelfth of the total basic salary earned in the calendar year.
13th month pay = total basic salary earned in the year ÷ 12. Three things trip people up: the base is basic salary only (no OT, premiums, or allowances); it prorates by what was actually earned, so mid-year hires and resignees get a proportional amount; and leave without pay reduces the base. Deadline: December 24. Tax: exempt up to the ₱90,000 bonus threshold.
13th month pay = total basic salary earned during the calendar year ÷ 12 (PD 851). An employee paid ₱18,000/month for all 12 months receives ₱18,000. Someone who worked only 6 months receives 6 × 18,000 ÷ 12 = ₱9,000 — it prorates automatically because the formula uses actual basic salary earned, not the monthly rate.
Basic salary only. Overtime pay, holiday and night-differential premiums, allowances (COLA), unused-leave conversions, and other monetary benefits are excluded from the base unless they have been made part of the basic salary by agreement or practice.
Yes. Days without pay reduce the basic salary actually earned, and the 13th month base with it. Paid leaves count; leave without pay does not.
On or before December 24 of every year. Employers may release half earlier (commonly June) and the balance in December. All rank-and-file employees who worked at least one month in the year are entitled to it.
It is tax-exempt up to ₱90,000 combined with other bonuses and benefits in the year (TRAIN law threshold). Only the amount above ₱90,000 is subject to withholding tax.
Yes — guards are rank-and-file employees of the agency, which must pay it regardless of client billing arrangements. Under D.O. 174 the contract rate billed to principals is expected to carry the 13th-month accrual, which is why agency bill rates include a 13th-month component.
NexusWorkforce accrues 13th-month pay from actual payroll all year, prorates joiners and leavers automatically, and carries the accrual into your D.O. 174 client bill rates. Built for Philippine security and manpower agencies.
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