--- title: 13th Month Computation in Pre-Annualization description: N/A --- [Skip to content](https://guide.sprout.ph/13th-month-computation-in-pre-annualization#main-content) [![Sprout Logo-3](https://guide.sprout.ph/hs-fs/hubfs/Sprout%20Logo-3.png?width=200&height=78&name=Sprout%20Logo-3.png)](https://guide.sprout.ph/?hsLang=en) Open main navigation Close main navigation How can we help you? - There are no suggestions because the search field is empty. 1. [Sprout](https://guide.sprout.ph/?hsLang=en) 2. [Sprout Payroll](https://guide.sprout.ph/sprout-payroll?hsLang=en) 3. [13th Month](https://guide.sprout.ph/sprout-payroll?hsLang=en#13th-month) # 13th Month Computation in Pre-Annualization   Pre-annualized tax Computation calculates the tax due using the annual tax table by considering the employee’s previous, current, and forecasted income for the rest of the year, while also taxing variables like absences, undertime, bonuses, and deductions only in the period they occur, then dividing it by the remaining payouts. In the setup, you can choose to 'Include 13th-month pay' in the tax calculation. ![](https://guide.sprout.ph/hs-fs/hubfs/image-png-Jun-11-2025-02-06-30-7974-AM.png?width=515&height=199&name=image-png-Jun-11-2025-02-06-30-7974-AM.png) If the "13th-month pay" option is ticked in the pre-annualization tax calculation setup, the system will capture the assumed 13th-month pay based on the 13th-month computation setup. On the other hand, if the "13th-month pay" option is unticked, the system will capture the actual 13th-month pay processed. It is important to note that the system will reflect either the assumed or the actual 13th-month pay, but not both. Therefore, we recommend unticking the 'Include 13th month pay' option once you have processed the final 13th month pay, so that the system captures the actual 13th month processed instead of the assumed value. This configuration ensures that payroll calculations align with the correct 13th month pay value, resulting in more accurate tax computations, particularly in relation to annualization. *Want real-time responses? 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