Income tax · Free tool
8% vs Graduated: Am I Overpaying?
Compare both tax options side by side using your income and expenses, and see which one saves you more.
Am I Overpaying?
Enter your income, select your freelancer type, and find out which tax structure saves you the most.
This is for informational purposes only and does not constitute financial, tax, or legal advice.
Learn more: 8% vs graduated tax — which saves more? →
Numbers last checked October 19, 2026 · Income tax rates (8%, graduated, OSD, ₱3M threshold), Percentage tax (2551Q, 3%)
Your numbers stay in your browser. This is an estimate for information only, not tax advice.
Common questions
Is 8% always cheaper?
Not always. If you have large, well-documented business expenses, graduated rates with itemized deductions can cost less. The comparison above shows both with your numbers.
When do I choose the 8% option?
You elect it on your first quarterly return of the year (or when you register). If you do not elect it, you are taxed at graduated rates for the whole year.
Do I still pay percentage tax on graduated rates?
Yes, if you are not VAT-registered you also file Form 2551Q for percentage tax each quarter. On the 8% option you do not.
Based on: BIR