Freelancer Tax Calculator Philippines

How to use this calculator

Enter your gross income or sales for the year, before expenses.
Add your business expenses for the year if you plan to use itemized deductions.
Tick the employee box if you also earn a salary, since the ₱250,000 deduction for the 8% option does not apply then.
Compare the totals for the 8% option, graduated with 40% OSD and graduated with itemized deductions.
Check which option costs you the least and by how much, then confirm the rules with the BIR or an accountant.

How are freelancers taxed in the Philippines?

Self-employed individuals, freelancers and online sellers can usually pick how they are taxed. The 8% option is a simple flat tax on gross income above ₱250,000 that replaces income tax and the percentage tax. Graduated rates use the TRAIN table on your taxable income, plus a 3% percentage tax on gross sales or receipts.

Which option is cheaper depends on your income and expenses. Low expenses often favor the 8% option, while high real expenses can favor graduated rates with itemized deductions. This calculator shows all three side by side so you can see the difference in pesos.

Freelancing across borders? See our Airwallex guide, and use the take-home pay calculator if you also have a salary job.

How the three options are compared

8% option: 8% of your gross income above ₱250,000, in place of income tax and the percentage tax. If you also have a salary, the ₱250,000 deduction does not apply.
Graduated rates with 40% optional standard deduction (OSD): your taxable income is 60% of gross, taxed with the TRAIN table, plus 3% percentage tax on gross sales or receipts.
Graduated rates with itemized deductions: your taxable income is gross minus your actual business expenses, taxed with the TRAIN table, plus 3% percentage tax.
The 8% option is generally available when gross sales and receipts are ₱3,000,000 or below and you are not VAT-registered.

Rules used: SSS 2025 schedule, PhilHealth 5% premium, Pag-IBIG 2024 cap, BIR TRAIN tax table (2023 onward). Check the official agency pages if your employer follows a newer schedule.

Tips to save more

Keep records of income and receipts for every expense.
Review your option each year, since your income and expenses change.
Set aside the estimated tax each month so quarterly filing is not a surprise.
Ask a licensed accountant before you elect an option or when your income grows.

Frequently asked questions

Should I choose the 8% tax or graduated rates?

It depends on your income and expenses. The 8% option is simple and often cheaper when your expenses are low. Graduated rates with itemized deductions can win when your real expenses are high. This calculator shows all three.

Who can use the 8% option?

Self-employed individuals and professionals with gross sales or receipts of ₱3,000,000 or below who are not VAT-registered can generally elect it. Check the latest BIR rules for your case.

What is the optional standard deduction?

It lets you deduct 40% of your gross income without listing expenses. You pay graduated income tax on the rest, plus percentage tax on gross sales or receipts.

Do I still pay percentage tax under the 8% option?

No, the 8% option replaces income tax and the percentage tax. Under graduated rates, you usually pay a 3% percentage tax on gross sales or receipts unless VAT applies.

Is this tax advice?

No. It is an estimate for planning. Rules, thresholds and filing requirements can change, so confirm with the BIR or a licensed accountant before you file.

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This calculator gives estimates for planning only. It is not financial, tax or legal advice. Confirm exact figures with your employer, bank, lender or the relevant government agency.