Philippines
Asia
The Philippines has a graduated income tax system with rates from 0% to 35% for individuals. Corporate tax is 25% for domestic corporations and 30% for foreign corporations. Value Added Tax (VAT) is 12% on most goods and services. The Bureau of Internal Revenue (BIR) administers the tax system. The tax year follows the calendar year, with individual returns due by April 15th.
How Taxation Works in Philippines
Understand the basics of Philippines's tax system, who pays tax, and how rates apply to individuals and businesses.
Tax System
The Philippines uses a self-assessment tax system where taxpayers calculate and report their own tax obligations. The BIR administers tax collection and enforcement. Tax returns are filed annually, and taxpayers must pay their tax liability by the deadline. Withholding tax is a key mechanism for collecting tax from compensation.
Residents
Resident citizens are taxed on worldwide income. Resident aliens are taxed on Philippine-sourced income. Non-resident aliens are taxed only on Philippine-sourced income. Employers withhold tax from employee compensation.
Non-Residents
Tax residents include resident citizens and resident aliens present in the Philippines for 183 days or more in a calendar year. Residents are taxed on worldwide income. Non-residents are taxed only on Philippine-sourced income.
Individuals
The Philippines has a graduated income tax system with rates from 0% to 35%. The first PHP 250,000 is exempt from tax. Various deductions and exemptions are available.
Businesses
Corporate tax is 25% for domestic corporations and 30% for foreign corporations. VAT is 12% on most goods and services. Minimum corporate income tax of 1% applies to corporations with net losses.
Tax Residency
The Philippines taxes resident citizens on worldwide income and resident aliens on Philippine-sourced income. Non-resident aliens are taxed only on Philippine-sourced income.
Graduated Tax Rates
The Philippines uses graduated income tax rates from 0% to 35%. The first PHP 250,000 is exempt from tax.
Withholding Tax
Withholding tax on compensation is based on the employer's computation. Employers deduct and remit tax monthly.
TRAIN Tax Reform
The Tax Reform for Acceleration and Inclusion (TRAIN) law rationalized VAT and enhanced the withholding tax system.
Current Tax Information
Calendar Year (January 1 – December 31) tax slabs, rates, thresholds, and key deductions for Philippines.
| Rate | Threshold | Notes |
|---|---|---|
| 0% | Up to PHP 250,000 | Annual taxable income |
| 20% | PHP 250,001 – PHP 400,000 | Annual taxable income |
| 25% | PHP 400,001 – PHP 800,000 | Annual taxable income |
| 30% | PHP 800,001 – PHP 2,000,000 | Annual taxable income |
| 32% | PHP 2,000,001 – PHP 8,000,000 | Annual taxable income |
| 35% | Above PHP 8,000,000 | Annual taxable income |
Standard Deduction
PHP 250,000 annual tax-free threshold for individuals. Additional deductions for SSS/GSIS, PhilHealth, Pag-IBIG, medical expenses, and charitable contributions.
Major Deductions
- Personal Exemption
PHP 250,000 annual tax-free threshold for individuals.
- SSS/GSIS Contributions
Contributions to Social Security System (SSS) or Government Service Insurance System (GSIS) are deductible.
- PhilHealth Contributions
Philippine Health Insurance Corporation contributions are deductible.
- Pag-IBIG Contributions
Pag-IBIG Fund contributions are deductible.
- Medical Expenses
Deduction for medical expenses exceeding 10% of gross income.
- Charitable Contributions
Deduction for donations to approved charitable institutions.
Tax Credits
- Withholding Tax Credit
Credit for withholding tax deducted at source on compensation and other income.
- Tax Treaty Credit
Credit for taxes paid in other countries under tax treaty provisions.
Important Dates
Key deadlines for Philippines tax filing, payments, and important milestones.
Tax Year Start
Philippine tax year follows the calendar year (January 1 – December 31).
Individual Tax Filing Deadline
Deadline for individuals to file annual income tax returns.
Corporate Tax Filing Deadline
Deadline for corporations to file annual income tax returns.
Tax Year End
End of the Philippine tax year.
Monthly Tax Return Deadline
Deadline for monthly tax returns (25th of each month).
Government Resources
For the most accurate and up-to-date information, visit the official government tax authority. Below are the most useful official portals, forms, and support resources for Philippines taxpayers.
Bureau of Internal Revenue (BIR)
Official Philippine tax authority — tax filing, payment, and guidance.
https://www.bir.gov.ph
eFPS
Electronic Filing and Payment System for tax returns.
https://www.bir.gov.ph/efps
BIR Tax Rates
Current individual and corporate income tax rates.
https://www.bir.gov.ph/tax-rates
Taxpayer Assistance
Taxpayer assistance and guidance services.
https://www.bir.gov.ph/assistance
Popular Philippines Calculators
Estimate your tax liability with our free Philippines calculators. All calculations run locally in your browser — no data is collected.
Frequently Asked Questions
Quick answers to common questions about Philippines taxation, filing requirements, and using our calculators.
What is the income tax rate in the Philippines?
Graduated rates from 0% to 35% based on annual taxable income. The first PHP 250,000 is exempt.
What is the VAT rate?
12% standard rate on most goods and services.
Who is a tax resident in the Philippines?
A resident citizen or a resident alien who is present in the Philippines for 183 days or more in a calendar year.
What is the corporate tax rate?
25% for domestic corporations. 30% for foreign corporations deriving income from Philippines sources.
When is the tax filing deadline?
April 15th for calendar year taxpayers.
Trust & Transparency
Last Updated
2025-06-15
Educational Disclaimer
The tax information and calculators on this page are for educational and informational purposes only. They do not constitute professional tax advice. Tax laws are subject to change. Always consult a qualified tax professional for advice specific to your situation.
Calculation Methodology
Tax calculations follow the Philippine Tax Code and BIR regulations. Graduated rates are applied to taxable income after deductions and exemptions. VAT is calculated on the taxable value of goods and services at 12%.
Data Sources
- Bureau of Internal Revenue (BIR) Philippines
- TRAIN Tax Reform Law
- BIR Revenue Regulations
Privacy-First
All calculations are performed locally in your browser. No personal data is collected, stored, or transmitted to any server. Your financial information never leaves your device.
