Annual Income Tax Calculator Philippines 2026
Use this annual income tax calculator Philippines to compute your full-year BIR income tax on the graduated TRAIN rates. Enter your annual taxable income and see your exact tax due, effective rate, and net income.
Last updated: June 2026 · Bureau of Internal Revenue · TRAIN Law RA 10963 · BIR Form 1701 (Table 2)
Taxable income = your gross pay minus mandatory SSS, PhilHealth and Pag-IBIG contributions and tax-exempt benefits.
Got your number? Two things worth checking next
→ Net Pay Calculator — see your monthly take-home after every deduction
→ Freelancer Tax Calculator — self-employed? check if the 8% flat rate beats the graduated rates
What is annual income tax?
Annual income tax is the tax the Bureau of Internal Revenue (BIR) charges on your total income for the year. If you are an employee, your employer withholds an estimate of it from every paycheck, and the annual income tax return simply reconciles those withholdings against what you actually owe — which is where a refund or a small balance due comes from. If you are self-employed or a professional, you compute and file it yourself. Either way, the amount is set by the graduated rates under the TRAIN Law (Republic Act No. 10963), which took their current form on January 1, 2023.
How your income tax is computed
The Philippines uses a graduated, bracketed system. The first ₱250,000 of your annual taxable income is taxed at 0% — completely tax-free. Income above that is taxed in tiers: only the portion that falls inside each bracket is charged at that bracket’s rate, so a raise never pushes your whole income into a higher rate. The calculator above applies the exact BIR schedule and also shows your effective tax rate — your total tax divided by your taxable income — which is always lower than your top bracket because of the tax-free first slice.
One detail matters a great deal: the rates apply to taxable income, not gross pay. For employees, taxable income is your gross salary minus your mandatory SSS, PhilHealth and Pag-IBIG contributions and any tax-exempt benefits (such as your 13th-month pay up to the legislated ceiling). For the self-employed, it is gross income minus your allowable deductions. Enter that taxable figure into the calculator for an accurate result.
BIR Graduated Income Tax Brackets (2023 onward)
| Annual Taxable Income | Income Tax Due |
|---|---|
| Not over ₱250,000 | 0% |
| Over ₱250,000 to ₱400,000 | 15% of the excess over ₱250,000 |
| Over ₱400,000 to ₱800,000 | ₱22,500 + 20% of the excess over ₱400,000 |
| Over ₱800,000 to ₱2,000,000 | ₱102,500 + 25% of the excess over ₱800,000 |
| Over ₱2,000,000 to ₱8,000,000 | ₱402,500 + 30% of the excess over ₱2,000,000 |
| Over ₱8,000,000 | ₱2,202,500 + 35% of the excess over ₱8,000,000 |
Frequently Asked Questions
How much income is tax-free in the Philippines?
The first ₱250,000 of annual taxable income is taxed at 0% under the TRAIN Law. If your taxable income for the year is ₱250,000 or less, your annual income tax is zero.
What are the BIR income tax rates for 2026?
The graduated rates run from 15% to 35%, following the schedule effective January 1, 2023 (BIR Form 1701, Table 2). The full bracket table is shown above; these rates remain in effect for 2026.
Should I enter my gross or taxable income?
Enter your taxable income — gross pay minus your mandatory SSS, PhilHealth and Pag-IBIG contributions and any tax-exempt benefits. The graduated rates are applied to taxable income, not gross pay.
Can freelancers pay a lower rate?
Self-employed individuals and professionals whose gross sales do not exceed ₱3,000,000 may opt for a flat 8% tax in lieu of the graduated rates and the percentage tax. Use the Freelancer Tax Calculator to see which is cheaper for you.
Related calculators & guides
📋 Rates verified — Official sources: bir.gov.ph · BIR Form 1701 (Table 2, effective Jan 1, 2023) · TRAIN Law (RA 10963)
⚠️ This is general information, not financial, tax, or legal advice. KnowMyGovt is an independent service — not affiliated with or endorsed by the SSS, PhilHealth, Pag-IBIG, the BIR, DOLE, or the Philippine government — and is not liable for decisions made in reliance on it.
