How this calculator works
Tax year: 2024, Philippines. Graduated rates are the TRAIN schedule effective from January 1, 2023. Monthly values are annualized, then divided by 12; actual withholding can differ. Enter taxable compensation after any separately exempt benefits, and enter actual eligible SSS, PhilHealth and Pag-IBIG amounts. No contribution rates are guessed. The 8% option is for an eligible pure self-employed person within the PHP 3 million threshold; no expense or contribution deduction is taken from its receipts base. Mixed income and percentage/VAT taxes are excluded.
Formula
Annual taxable compensation = 12 x (monthly taxable pay - eligible contributions). Apply graduated bands from PHP 250000 upward. Eligible pure self-employed 8% tax = 0.08 x max(0, annual receipts - 250000).
Worked example
PHP 40,000 monthly taxable compensation with no supplied contributions gives PHP 480,000 annually. Tax is PHP 22,500 plus 20% of PHP 80,000, or PHP 38,500 a year. Eligible pure self-employed receipts of PHP 500,000 under the 8% option give PHP 20,000 tax.
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Frequently asked questions
Are contributions calculated automatically?
No. Enter the amounts from the applicable contribution schedules or pay statement. The result subtracts only the values you provide.
Can a mixed-income earner use this 8% calculation?
No. The PHP 250,000 reduction and mixed-income rules differ. Use the applicable BIR return.
Is average monthly tax the exact withholding?
No. Annualization excludes irregular bonuses, prior withholding and payroll-specific adjustments.