Mixed income earner tax calculator
A mixed income earner has a salary and also earns from a business or a profession. Your salary is always taxed at graduated rates. For the business part you can choose.
Enter both incomes and see which choice gives the lower total tax for the year.
How it's calculated
- Your taxable compensation is taxed with the graduated rates of the Tax Code.
- 8% option: you add 8% of all your gross business receipts. There is no ₱250,000 exclusion, because that amount is already in the 0% bracket of your salary.
- Graduated option: your net business income is added to your compensation and taxed together, plus a percentage tax of 3% on your gross receipts.
An example
With ₱400,000 of taxable salary and ₱600,000 of receipts (₱150,000 of expenses), the 8% option costs ₱70,500 in total. Graduated rates cost ₱133,000.
Frequently asked questions
Why can't I deduct ₱250,000 from my business receipts?
The rules say the ₱250,000 is already built into the 0% bracket that applies to your salary. Only people who earn purely from a business or profession get it under the 8% option.
Can I use the 8% option if my receipts are above ₱3,000,000?
No. Above the VAT threshold your business income is taxed at graduated rates together with your salary.
How is the total tax worked out with the 8% option?
It is the tax on your compensation at graduated rates plus 8% of your gross business receipts and other non-operating income.
Key terms
- Mixed income earner
- A person with both compensation income and income from a business or profession.
- Non-operating income
- Income outside your main business activity. The rules add it to your gross receipts for the 8% option.
Up-to-date official data
Data checked against the official source on .
We check the official sources automatically, every day.
- BIRDigest of Revenue Regulations No. 8-2018 (TRAIN income tax)
- BIRRevenue Memorandum Circular No. 69-2023