Philippines Income Tax Calculator
Estimate your 2026 Philippine income tax under the TRAIN Law using current BIR brackets.
What this calculator does
Estimates your Philippine income tax liability under the TRAIN Law's graduated tax table, showing exactly how much of your income falls into each bracket.
Who this is for
Filipino employees estimating their annual tax bill, self-employed individuals comparing the graduated table against the 8% flat-rate option, or anyone checking a job offer's real take-home value.
How this calculator works
The Philippines has used the same TRAIN Law (Republic Act 10963) income tax schedule since January 2023, with no changes since. Annual taxable income up to ₱250,000 is completely tax-exempt, with progressive rates from 15% to 35% above that. Taxable income is your gross compensation minus mandatory contributions (SSS, PhilHealth, Pag-IBIG) and any non-taxable allowances.
Worked example
₱600,000 taxable income falls in the ₱400,000–₱800,000 bracket: base tax of ₱22,500 plus 20% of the amount over ₱400,000. That's ₱22,500 + (20% × ₱200,000) = ₱22,500 + ₱40,000 = ₱62,500 total tax, an effective rate of about 10.4% on the full ₱600,000 — well below the 20% bracket rate, since only the income within that bracket is taxed at 20%.
A second example at ₱1,500,000 falls in the ₱800,000–₱2,000,000 bracket: base tax of ₱102,500 plus 25% of the amount over ₱800,000. That's ₱102,500 + (25% × ₱700,000) = ₱102,500 + ₱175,000 = ₱277,500 total tax, an effective rate of about 18.5% — still well under the 25% marginal bracket, showing how gradually the effective rate climbs even as income moves into higher brackets.
The OFW Tax Exemption — a Uniquely Philippine Feature
This calculator models domestic Philippine employment income under the TRAIN Law brackets above. But a huge share of Filipino workers earn income under a completely different rule: Overseas Filipino Workers (OFWs) are classified as non-resident citizens under Section 23(C) of the National Internal Revenue Code and are exempt from Philippine income tax entirely on income earned abroad, provided they hold valid POEA/DMW-registered overseas employment documentation. Remittances sent home are also not treated as taxable income for the family members receiving them.
This isn't a minor exception — OFW remittances have historically made up roughly 8-9% of Philippine GDP, among the highest remittance-to-GDP ratios of any country in the world alongside India, Pakistan, and Mexico. The exemption only covers foreign-sourced income, though: if an OFW has Philippine-sourced income too (local rental property, a Philippine bank account, a local business), that portion remains fully taxable under the normal brackets shown above. This calculator is built for domestic employment income — if you're an OFW estimating tax on local-source income only, the same brackets apply to that portion.
Where your income goes
Run the calculator above to see the tax vs. take-home split.
2026 tax bracket breakdown
Run the calculator above to see your income split across brackets.
Common mistakes
- Applying the bracket rate to your whole income. Someone in the 25% bracket doesn't pay 25% of their whole income — only the portion of income that actually falls within that bracket is taxed at that rate.
- Forgetting mandatory contributions reduce taxable income. SSS, PhilHealth, and Pag-IBIG are deducted before income tax brackets apply, so taxable income is lower than gross salary.
- Missing the 8% flat-rate option. Self-employed individuals and professionals with gross sales under ₱3,000,000 can often save money by choosing the simpler 8% flat rate instead of graduated brackets plus percentage tax.
- Not comparing both options if self-employed. The 8% flat rate isn't always better — at lower income levels, the graduated table's 0% band on the first ₱250,000 can sometimes produce a lower total tax than a flat 8% on all gross sales.
- Assuming OFW status automatically applies. The foreign-income exemption requires valid POEA/DMW-registered overseas employment documentation (an OEC) — it isn't automatic just because you're working outside the Philippines informally.
- Forgetting Philippine-sourced income stays taxable for OFWs. The exemption only covers foreign-earned income — local rental income, a Philippine business, or Philippine bank interest remains taxable under the same brackets shown here.
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Frequently Asked Questions
Should self-employed individuals use the graduated table or the 8% flat rate?
It depends on income level and expenses. The 8% flat rate on gross sales is simpler and often better for higher earners with few deductible expenses, while the graduated table (with its tax-free first ₱250,000) can work out cheaper at lower income levels or for those with significant deductible business expenses.
Is the first ₱250,000 really tax-free?
Yes, under the TRAIN Law, annual taxable income up to ₱250,000 is completely exempt from income tax.
Does this include SSS, PhilHealth, and Pag-IBIG?
No, this calculates income tax only. Mandatory contributions to SSS, PhilHealth, and Pag-IBIG are separate deductions calculated on their own schedules.
Can self-employed people use a different tax option?
Yes, self-employed individuals and professionals with gross sales under ₱3,000,000 can opt for a flat 8% tax on gross sales instead of the graduated brackets shown here.
Do Overseas Filipino Workers pay Philippine income tax?
No, not on income earned abroad. OFWs are classified as non-resident citizens under the National Internal Revenue Code and are exempt from Philippine income tax on foreign-sourced income, provided they hold valid POEA/DMW-registered overseas employment documentation.
Are remittances from OFWs taxed when received in the Philippines?
No, remittances sent home by OFWs are not treated as taxable income for the recipient — they're classified as personal support, not compensation.