FAQ >
How does payroll software calculate withholding tax on a 13th month pay or bonus that exceeds the tax-exempt threshold in the Philippines?
Question
How does payroll software calculate withholding tax on a 13th month pay or bonus that exceeds the tax-exempt threshold in the Philippines?
Answer
Omni HR calculates 13th month pay and bonuses, then applies BIR withholding tax only to the portion above the tax-exempt threshold. HR doesn't need to track that threshold separately, and the figures feed into the BIR 2316 generated at year-end.
Updated
Aug
2026
