How to Compute Your Withholding Tax in the Philippines (2026 BIR TRAIN Law Table + Step-by-Step Examples)

Is there a new 2026 tax table?

No. The TRAIN law (RA 10963) rolled out in two phases: transitional rates from 2018 to 2022, then a permanent, lower schedule starting January 1, 2023. That 2023 schedule is still the one in effect for 2024, 2025, and 2026 — there has been no new individual compensation tax reform law since. If you're searching for "2026 tax table changes," this is the answer: the brackets are identical to 2023-2025, so once you learn the table once, it stays valid. For the fuller history of what TRAIN actually changed, see TRAIN Law Explained.

Who's exempt

Employees earning ₱20,833 or less per month (₱250,000 or less annually) in taxable compensation pay zero withholding tax. 13th month pay and other benefits also remain non-taxable up to a combined ₱90,000 annual cap — only the amount above that threshold gets added to taxable income.

The 2026 monthly withholding tax table

Taxable compensation is your gross pay minus mandatory contributions (SSS, PhilHealth, Pag-IBIG) and any non-taxable benefits. Once you have that figure, match it to a bracket:

Semi-monthly, weekly, and daily tables follow the same bracket logic scaled to each pay frequency — the Withholding Tax Calculator handles that conversion for you.

Step-by-step: how the formula works

The BIR uses the same structure for every bracket:

Withholding Tax = Fixed Tax + (Tax Rate × Excess over Bracket Minimum)

Worked example 1 — ₱28,000 monthly taxable income. This falls in the ₱20,833–₱33,332 bracket. Excess over ₱20,833 = ₱28,000 − ₱20,833 = ₱7,167. Withholding tax = 15% × ₱7,167 = ₱1,075.05.

Worked example 2 — ₱50,000 monthly taxable income. This falls in the ₱33,333–₱66,666 bracket. Excess over ₱33,333 = ₱50,000 − ₱33,333 = ₱16,667. Withholding tax = ₱1,875 + (20% × ₱16,667) = ₱1,875 + ₱3,333.40 = ₱5,208.40.

These two examples round the bracket floor to the nearest whole peso before subtracting, the way you'd do it by hand from a printed table. Our Withholding Tax Calculator instead annualizes your exact pay and works from the precise annual brackets, so it may land a few centavos to a peso different from a hand calculation like this one — both are correct, just rounded at a different step.

Marginal bracket vs. effective rate

The bracket you fall into is your marginal rate, not your average rate. Someone in the 25% bracket does not pay 25% on their entire salary, only on the portion above the bracket's floor. This is why your effective tax rate — total tax divided by total income — is always lower than the bracket label suggests, and it's the most common source of confusion when comparing payslips.

Common payroll mistakes to watch for

• Using gross salary instead of taxable compensation. Always subtract SSS, PhilHealth, and Pag-IBIG contributions first.
• Forgetting annualization on bonus months. A one-time bonus can temporarily push a monthly projection into a higher bracket; the year-end Form 2316 reconciliation corrects this, so a high withholding month isn't necessarily an error.
• Applying the old 2018-2022 table. That earlier schedule used higher 20%-32% middle rates and is no longer in effect.
• Missing the exemption threshold. Minimum wage earners and anyone at or below ₱20,833 monthly taxable income owe zero income tax, including on overtime and night differential.

Check your own number

Manual computation works for a single payslip, but it gets error-prone once bonuses, irregular pay periods, or multiple contribution changes enter the picture. Run your gross salary and pay frequency through our Withholding Tax Calculator to get your exact bracket, fixed tax, and final withholding amount without doing the arithmetic by hand.