Freelancer 8% Tax Calculator (Philippines)

The 8% tax option for freelancers

Self-employed individuals and professionals in the Philippines can choose to be taxed at a flat 8% on gross sales or receipts instead of the regular graduated income-tax table. Crucially, the 8% applies only to the amount over ₱250,000 a year, and it replaces both the graduated income tax and the 3% percentage tax — one simple computation instead of two.

Who can use it

• Your annual gross is ₱3,000,000 or less (the VAT threshold).
• You're not VAT-registered.
• You elect the 8% option (on your first quarterly return or registration).

Is 8% always better?

Not necessarily. The 8% is on gross receipts with no deductions for expenses. If your business has high costs, the graduated rates (which tax net income after expenses) can work out lower. The 8% shines for low-overhead earners like freelancers and consultants. Run both before you choose.

FAQ

Is this 8% tax calculator free to use?

Yes, it's completely free with no sign-up. You can run as many estimates as you like to compare the 8% option against the graduated rates.

Is my income data private?

Yes. Your gross sales and figures are calculated in your browser and never sent to a server or stored, so your income details stay on your device.

How do I elect the 8% income tax rate?

You signify your choice on your first quarterly income tax return for the year (BIR Form 1701Q) or at the time of registration. The election applies for the whole taxable year and cannot be changed midway, so decide before you file the first quarter.

Is the ₱250,000 deduction applied every year?

Yes, the ₱250,000 reduction applies to the 8% computation each taxable year for purely self-employed individuals. Note that mixed-income earners (with both a job and a business) do not get the ₱250,000 against their business income, because it's already built into the compensation tax table.

Do I still pay the 3% percentage tax under the 8% option?

No. The 8% rate is a substitute for both the graduated income tax and the 3% percentage tax, so you file one computation instead of two. This is a key reason the 8% is simpler for many low-expense freelancers.

Not tax advice — confirm with the BIR or an accountant.