Tax Tables and Brackets in the Philippines for 2026

Tax laws in the Philippines cover two main types of taxes:

National taxes imposed and collected by the national government
Local taxes imposed and collected by local government units

These laws are primarily governed by the National Internal Revenue Code of 1997, also known as the Tax Code, along with Revenue Issuances and official rulings issued by the Bureau of Internal Revenue (BIR).

The Tax Code provides income tax tables that outline the applicable income tax brackets and rates for individuals and businesses. Understanding these tables is essential for accurate tax planning and staying compliant with Philippine tax regulations in 2026. Keep reading to learn more about 2026 tax brackets in the Philippines.

2026 Tax Rates in the Philippines

Headline Tax Rates	Tax Rate (%)
Headline Personal Income Tax (PIT) Rate	35
Headline Corporate Income Tax (CIT) Rate	25

* Domestic corporations with taxable income not exceeding ₱5 million and total assets not exceeding ₱100 million, excluding land, may qualify for a reduced 20% corporate income tax rate under the CREATE Act.

Personal Income Tax (PIT) Rates in the Philippines

Personal Income Tax (PIT) is the tax imposed on an individual’s taxable income earned within or outside the Philippines, depending on residency status. It applies to both resident and non-resident individuals, with tax treatment varying based on the type and source of income.

In 2026, personal income tax rates for individuals remain aligned with the revised rates under the TRAIN Law (R.A. 10963), which continue to apply unless amended by new legislation.

An individual’s personal income tax rate depends on the nature of their income, including:

Compensation income: Income earned from employment, such as salaries, wages, allowances, and other employee benefits. This type of income is taxed using the graduated income tax table in the Philippines.
Income subject to final tax: Certain types of income are subject to final withholding tax at specific rates, such as interest income, royalties, dividends, and prizes. These are taxed separately from the graduated income tax rates.
Gross sales/receipts and other non-operating income not exceeding the VAT threshold: Self-employed individuals and professionals whose gross sales or receipts do not exceed the VAT threshold may opt to be taxed either under the graduated income tax rates or the 8% income tax rate on gross sales/receipts in excess of ₱250,000, in lieu of percentage tax.

For 2026, the graduated personal income tax rates range from 0% to 35%, depending on taxable income.

Compensation Tax Rates for Resident and Non-Resident Individuals

The following graduated income tax rates apply to compensation income earned by resident and non-resident individuals in 2026, in accordance with the TRAIN Law provisions effective from January 1, 2023 onwards:

Compensation Tax Rates for Resident and Non-Resident Individuals
Taxable Income (PHP)		Tax on column 1 (PHP)	Tax on excess (%)
Over	Not over	Tax on column 1 (PHP)	Tax on excess (%)
0	250,000	-	0%
250,000	400,000	-	15%
400,000	800,000	22,500	20%
800,000	2,000,000	102,500	25%
2,000,000	8,000,000	402,500	30%
8,000,000		2,202,500	35%

Please note: Resident individuals are taxed on worldwide income, while non-resident individuals are taxed only on income earned from sources within the Philippines.

Tax Rates for Income Subject to Final Tax

Certain types of income are subject to final withholding tax, meaning the tax is withheld at source and no longer included in the computation of graduated income tax. These typically include passive income such as interest, dividends, royalties, and prizes.

The applicable final tax rates for individuals in 2026 include:

Tax Rates for Income Subject to Final Tax	Tax Rate (%)
Resident Individuals	20%*
Non-Resident Individuals	25%

8% Income Tax Rate or Graduated Rates for Non-VAT Registered Individuals (2026)

Self-employed individuals and professionals in the Philippines are subject to income tax on their gross sales, receipts, and other non-operating income.

If their annual gross sales or receipts do not exceed the VAT threshold of ₱3,000,000, they may choose between two income tax options in 2026:

8% income tax on gross sales/receipts and other non-operating income in excess of ₱250,000, in lieu of the graduated income tax rates and percentage tax; or
Graduated income tax rates ranging from 0% to 35%, based on taxable income.

The 8% option simplifies tax computation and is often chosen by freelancers, sole proprietors, and small businesses that remain below the VAT threshold.

Personal Income Tax (PIT) Due Dates in the Philippines (2026)

Individuals must comply with the following personal income tax deadlines for taxable year 2026:

Personal Income Tax (PIT) Due Dates
PIT return due date	15 April
PIT final payment due date	15 April
PIT estimated payment due dates	For self-employed individuals and professionals, quarterly estimated income tax payments are generally due on May 15, August 15, and November 15, with the final adjustment payment due on April 15 of the following year.

For individuals earning purely compensation income, taxes are withheld and remitted by employers under the withholding tax system. An annual reconciliation of income and taxes withheld is performed at year end, typically in December.

Filing and payment

Under Republic Act No. 11976, also known as the Ease of Paying Taxes (EOPT) Act, the Commissioner of Internal Revenue may require tax returns to be filed through authorized agent banks, Revenue District Offices, or accredited tax software providers of the Bureau of Internal Revenue (BIR).

Corporate Income Tax (CIT) Rates in the Philippines 2026

Corporate income tax rates vary depending on whether the corporation is domestic, resident foreign, or non-resident foreign, as well as its income level and total assets.

Corporate income tax rates for domestic corporations (2026)

Income	Tax Rate (%)
In general, on net taxable income from all sources.	25
On net taxable income of domestic corporations with total assets not exceeding ₱100 million (excluding land) and net taxable income not exceeding ₱5 million.	20
Minimum Corporate Income Tax (MCIT) on gross income, beginning on the fourth taxable year following commencement of business operations.	2
Proprietary educational institutions and non-profit hospitals, on net taxable income, provided gross income from unrelated trade, business, or other activity does not exceed 50% of total gross income.	10

Corporate income tax rates for resident foreign corporations

The following corporate income tax rates apply to resident foreign corporations operating in the Philippines in 2026:

Income	Tax Rate
Income of international carriers on gross Philippine billings.	2.5%
Interest income from foreign currency loans granted by Foreign Currency Deposit Units (FCDUs) of depository banks to residents other than offshore banking units (OBUs) or other FCDUs.	10%

Corporate income tax rates for non-resident foreign corporations

The following tax rates apply to non-resident foreign corporations on income derived from Philippine sources in 2026:

Income	Tax rate
Income tax (in general).	25%
Reinsurance premiums.	Exempt
Interest on foreign loans.	20%
Dividends from domestic corporations, if the country in which the foreign corporation is domiciled does not impose income tax on such dividends, or allows a tax deemed paid credit of 10%.	15%
Rentals and charter fees payable to non-resident owners of vessels chartered by Philippine nationals.	4.5%
Rentals, charters, and other fees derived by non-resident lessors of aircraft, machinery, and other equipment.	7.5%

Corporate income tax due dates

The following corporate income tax filing and payment deadlines apply for taxable year 2026:

Corporate Income Tax (CIT) Due Dates
CIT quarterly return due dates	Within 60 days after the close of each of the first three quarters of the taxable year.
CIT annual return due date	On or before the 15th day of the fourth month following the close of the taxable year.
CIT final payment due date	On or before the 15th day of the fourth month following the close of the taxable year.
CIT estimated payment due dates	Quarterly income tax payments are made within 60 days after the close of each of the first three quarters.

Fringe Benefits Tax (FBT) Rates

Fringe Benefits Tax (FBT) applies to certain non-cash benefits granted by employers to managerial and supervisory employees.

Tax Rates for Fringe Benefits	Rate
Managerial and Supervisory Employees	35%
Non-resident Aliens Not Engaged in Trade or Business	25%

Fringe benefits granted to managerial and supervisory employees are subject to a final 35% FBT based on the grossed-up monetary value of the benefit. For non-resident aliens not engaged in trade or business in the Philippines, the applicable rate is 25%.

Employers are responsible for paying FBT on a quarterly basis. The tax is deductible as a business expense, and the fringe benefit is no longer included in the employee’s taxable compensation income.

Capital Gains Tax in the Philippines

Capital gains tax (CGT) applies to the sale or exchange of certain capital assets located in the Philippines. The applicable rate depends on the type of asset and the taxpayer classification.

In 2026, the following general rules apply:

6% capital gains tax on the sale of real property located in the Philippines that is classified as a capital asset, based on the gross selling price or fair market value, whichever is higher.
15% capital gains tax on the sale of shares of stock not traded on the Philippine Stock Exchange.
0.6% stock transaction tax on the sale of shares listed and traded through the Philippine Stock Exchange.
Capital gains from long-term bonds, debentures, or other certificates of indebtedness with a maturity of more than five years may be exempt, subject to compliance with Tax Code requirements.

Capital losses may generally be deducted from capital gains, subject to applicable limitations under Philippine tax law.

Non-resident individuals and foreign corporations are taxed on Philippine-sourced capital gains, while residents are taxed in accordance with applicable income tax rules and classifications.

Withholding Tax Rates for Residents and Non-Residents

Businesses and individuals engaged in trade or business in the Philippines are generally required to withhold tax on certain income payments to residents and non-residents.

For payments made to non-resident individuals and non-resident foreign corporations, the general withholding tax rate is 25% on Philippine-sourced income, unless a different rate applies under the Tax Code.

However, the Philippines has entered into double taxation treaties (DTTs) with various countries. Where a valid tax treaty applies, reduced withholding tax rates may be available, subject to proper documentation and compliance with Bureau of Internal Revenue (BIR) requirements.

Withholding tax rates may vary depending on the type of income, such as interest, dividends, royalties, professional fees, or rentals.

Value Added Tax Rates in the Philippines

Value Added Tax (VAT)	Tax Rate (%)
Standard VAT	12%

The standard VAT rate in the Philippines remains 12% in 2026 and applies to most sales of goods, properties, and services, as well as importations.

A 12% VAT also applies to foreign digital service providers (DSPs) supplying digital services to consumers in the Philippines. This includes online marketplaces, search engines, cloud services, digital advertising, and streaming platforms. Certain transactions, such as specific educational and financial services, may qualify for VAT exemption under existing regulations.

Businesses with annual gross sales or receipts exceeding ₱3,000,000 are generally required to register as VAT taxpayers.

FAQs about BIR Income Tax Tables

What is the tax percentage in the Philippines?

One of the most commonly-asked questions at tax time is: “How much is income tax in the Philippines?” The answer to this depends on the type of taxpayer and the nature of the income.

For 2026, the headline tax rates are:

Personal Income Tax (PIT): Up to 35%, depending on taxable income under the graduated tax table
Corporate Income Tax (CIT): Generally 25% for domestic corporations

Certain domestic corporations that meet asset and income thresholds may qualify for a reduced 20% corporate income tax rate. Other taxes, such as capital gains tax, final withholding tax, and value-added tax (VAT), apply at different rates depending on the transaction.

What is the tax rate in the Philippines in 2026?

Tax rates in the Philippines vary depending on the type of taxpayer and the nature of the income. For 2026, the key tax rates include:

Personal Income Tax (PIT): Graduated rates from 0% to 35% for resident and non-resident individuals
Final Tax on Certain Income:
Residents – generally 20% (e.g., interest income)
Non-residents – generally 25%, unless a different statutory or treaty rate applies
8% Income Tax Option: Available to self-employed individuals and professionals with gross sales/receipts not exceeding the ₱3,000,000 VAT threshold, applied on income exceeding ₱250,000
Corporate Income Tax (CIT):
Domestic corporations – generally 25%, or 20% if qualified; 2% Minimum Corporate Income Tax (MCIT) may apply
Resident foreign corporations – generally 25%, with certain income taxed at preferential rates (e.g., 2.5% or 10%)
Non-resident foreign corporations – generally 25%, with preferential rates ranging from 4.5% to 15% for specific types of income
Capital Gains Tax (CGT):
6% on the sale of real property classified as a capital asset
15% on shares not traded on the stock exchange
0.6% stock transaction tax on listed shares
Withholding Tax (WHT): Generally 25% for non-residents, unless reduced by treaty or specific provisions
Value-Added Tax (VAT): 12% standard rate

QuickBooks VAT calculator is a useful tool that can help make your life easier at tax time.

What is the financial year for 2026 in the Philippines?

In the Philippines, a financial year, also known as a fiscal year, covers a 12-month accounting period. It may follow the calendar year, which runs from January 1 to December 31, or a fiscal year that ends on a different month.

For taxable year 2026, many businesses operate on a calendar-year basis ending December 31, 2026. However, companies may adopt a fiscal year ending on another month, such as March, provided it covers a continuous 12-month period and is consistently applied for tax reporting purposes.

What is the tax rate in the Philippines for 2027?

As of current legislation, the tax rates in the Philippines for 2027 are expected to remain the same as those in 2026, unless amended by new laws or regulations.

The key headline rates are:

Personal Income Tax (PIT): Graduated rates from 0% to 35%
Corporate Income Tax (CIT): Generally 25% for domestic corporations, or 20% for qualified small domestic corporations
Value-Added Tax (VAT): 12% standard rate
Capital Gains Tax (CGT):
6% on the sale of real property classified as a capital asset
15% on unlisted shares
0.6% stock transaction tax on listed shares

Other taxes, such as final withholding tax and fringe benefits tax, continue to apply at their respective statutory rates.

Tax rates may change if new legislation is enacted before or during 2027, so businesses and individuals should monitor updates from the Bureau of Internal Revenue (BIR).

What is the current income tax in the Philippines?

The tax tables for 2026 in the Philippines depend on the type of taxpayer and the nature of the income.

For individuals in 2026, personal income tax (PIT) follows a graduated tax table ranging from 0% to 35%, with the first ₱250,000 of taxable income exempt from tax. The highest rate of 35% applies to taxable income exceeding ₱8,000,000.

For corporations, the standard corporate income tax (CIT) rate is 25%. Qualified domestic corporations with net taxable income not exceeding ₱5 million and total assets not exceeding ₱100 million (excluding land) may be eligible for a reduced 20% rate.

Certain types of income, such as interest, dividends, and capital gains, may be subject to separate final tax rates under the Tax Code.

Learn more in our guide to e-Invoicing in the Philippines.

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