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BIR Income Tax
Compute your annual BIR tax under the TRAIN graduated brackets. Employed mode applies the ₱90K 13th-month exemption; freelancers see 8% flat vs graduated side-by-side.
Your BIR tax for the year
Annual take-home
₱587,500/yr
Annual BIR tax: ₱62,500 · Effective tax rate: 9.62%
- Annual taxable income
- ₱600,000
- 13th-month / bonus (tax-free)
- ₱50,000
- Annual BIR tax
- ₱62,500
TRAIN brackets as of 2026-05-18
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How it works
Employed: we add your gross annual compensation plus the taxable portion of your 13th-month and bonuses (anything above ₱90K) to get annual taxable income, then apply the TRAIN graduated brackets. Tax-exempt allowances pass through to take-home without affecting the tax. The effective rate is the tax as a share of your total cash.
Self-employed: we compute both regimes. The 8% flat tax is (gross − ₱250K) × 8%, available only if gross ≤ ₱3M VAT threshold. The graduated regime applies the TRAIN brackets directly to gross. The lower-tax regime is highlighted as the winner.
§ 03
Frequently asked questions
What are the BIR income tax brackets in 2026?
The Philippines uses the TRAIN Law (RA 10963) graduated brackets, Phase 2 effective since January 2023 (still current in 2026): ₱0–₱250K is tax-exempt, ₱250K–₱400K at 15%, ₱400K–₱800K at 20% (₱22,500 base), ₱800K–₱2M at 25% (₱102,500 base), ₱2M–₱8M at 30% (₱402,500 base), and above ₱8M at 35% (₱2,202,500 base). All amounts are annual taxable income.
Should freelancers pick the 8% flat tax or graduated rates?
If your gross annual sales are below ₱3M (the VAT registration threshold), the 8% regime is usually simpler and cheaper. The 8% applies only on income above ₱250,000, so a ₱1.2M freelancer pays ₱76,000 under 8% vs ₱202,500 under graduated. The calculator above shows both side-by-side with the winner highlighted. Above ₱3M gross, the 8% regime is unavailable.
Is the 13th-month pay taxable?
13th-month pay and other supplementary bonuses are tax-exempt up to a combined ₱90,000 per year. Anything above ₱90K is added to your annual taxable income and taxed at the graduated rates. The calculator handles this automatically — enter your full 13th-month + bonus, and it splits the tax-free portion from the taxable excess.
What is the ₱3M VAT threshold for self-employed?
Section 109(BB) of the NIRC requires VAT registration once gross annual sales exceed ₱3,000,000. Self-employed earners and freelancers below this threshold can opt into the simpler 8% flat tax on income above ₱250K — no percentage tax, no VAT, no graduated brackets. Cross ₱3M and you lose the 8% option entirely and must use graduated rates + 12% VAT.
How is the effective tax rate calculated?
The effective rate is your BIR tax divided by your total cash income (gross + bonuses + tax-exempt allowances). It's the real share of your total compensation that goes to BIR — different from the marginal bracket rate. A ₱600K + ₱50K bonus earner pays a ₱62,500 tax on ₱650K total, or about 9.6% effective.
Does this save or transmit my income data?
No. All math runs in your browser. We don't collect, store, or transmit your inputs to any server. Close the tab and the values disappear.
§ refs
Sources & references
From official issuer, regulator, and data-provider sites. Verify any figure against the primary source before acting on it.