Is the thirteenth-month pay subject to income tax?
The thirteenth-month pay is generally exempted from the requirement of withholding tax on compensation. However, it may be subject to income tax depending on the total nature and sources of income earned. According to Section 2.78.1(B)(11) of BIR Revenue Regulation No. 2-98, as amended by Republic Act No. 10963, there is a specific threshold for this exemption. The total amount of exclusions must not exceed the legally established cap to remain tax-free. 17-May-26About Nicolas and De Vega Law Offices
Nicolas and De Vega Law Offices is a full-service law firm in the Philippines. You may visit us at the 16th Flr., Suite 1607 AIC Burgundy Empire Tower, ADB Ave., Ortigas Center, 1605 Pasig City, Metro Manila, Philippines. You may also call us at +632 84706126, +632 84706130, +632 84016392 or e-mail us at [email protected]. Visit our website https://ndvlaw.com/.
