Net salary in the Philippines: income tax and contributions

Income tax scale 2026

Gross to net for common salaries (2026)

Single filer without children, standard scale and employee contributions. Estimates for planning, identical to the calculator above.

Wage benchmarks in the Philippines

Minimum wage: there is no single national rate in the Philippines. Each region’s tripartite board sets a DAILY rate by wage order, and the figures above are those of the National Capital Region under Wage Order No. NCR-27, issued on 23 June 2026 and effective 25 July 2026, with a second step to 780 and 743 PHP on 20 January 2027. The commission publishes them alongside this notice, which is reproduced here rather than interpreted: "Implementation of Wage Order No. NCR-27 is awaiting final Resolution from Pasig RTC 152 and Navotas RTC 287". The order it replaced, NCR-26, effective 18 July 2025, set 695 and 658 PHP. Average and median: no line. The Philippine Statistics Authority, which runs the Occupational Wages Survey, could not be reached on any of its hosts on the date of certification, and no figure is carried over from elsewhere.

Six bands, and no allowance at all

The scale in force is the one the TRAIN law wrote for tax years from 2023 onwards, and it carries no end date: nothing on the first 250,000 PHP of taxable income, then 15% to 400,000, 20% to 800,000, 25% to 2,000,000, 30% to 8,000,000 and 35% above. The statute writes each band as a fixed peso amount plus a rate on the excess, and those fixed amounts are exactly the running marginal tax, so a band-by-band calculation reproduces the law to the centavo.

What changed in 2018 was not only the rates. Section 12 of the same law repealed section 35 of the Tax Code outright, and with it the personal exemption and the additional exemption per dependent child. Nothing replaced them but the zero band itself. A Philippine payslip therefore carries no family quotient, no allowance for a spouse and no allowance per child, which is why this page carries no dependants input at all.

Sources: Republic Act No. 10963 (TRAIN) · Republic Act No. 8424 (National Internal Revenue Code)

Three contributions, three bases that do not coincide

The SSS charges 5% not of the salary but of a monthly salary credit, a step of 500 PHP read from a table that starts at 5,000 and stops at 35,000: the withholding rises in steps and freezes at 1,750 PHP a month. Above a credit of 20,000 the excess is credited to the Mandatory Provident Fund instead of the regular programme, which changes where the money goes, not what leaves the payslip.

PhilHealth charges half of a 5% premium, and computes it on the monthly basic salary, a base the circular defines as excluding commissions, overtime, allowances, the thirteenth month, bonuses and gratuities. Below a floor of 10,000 the premium is computed on the floor; above a ceiling of 100,000, on the ceiling. Pag-IBIG charges 2%, but on a fund salary its own circular defines as the basic salary AND other allowances, capped at 10,000, so 200 PHP a month at most. Three schemes, three definitions of pay, and one figure entered above: on 35,000 PHP a month the three together take 33,900 PHP over the year.

All three leave the tax base, and not as a deduction: section 32(B)(7)(f) of the Tax Code lists them under exclusions from gross income, so the amounts never enter the computation at all.

Sources: Republic Act No. 11199 (Social Security Act of 2018) · SSS Circular No. 2024-006 · Republic Act No. 11223 (Universal Health Care Act) · PhilHealth Circular No. 2020-0005 (Revision 1) · PhilHealth Advisory No. 2026-0042, on the premiums of overseas Filipinos · Pag-IBIG Fund Circular No. 460

The thirteenth month, and why it is left out here

A thirteenth month was instituted by a presidential decree of 1975 and extended by a memorandum order of 1986, and the TRAIN law leaves it, together with the other benefits of the year, outside gross income up to a combined 90,000 PHP. Which employees are entitled to it is a question of labour law that the tax exclusion does not answer. It is also outside the SSS monthly compensation the salary credit is read from, and outside the monthly basic salary PhilHealth runs on.

That is why the figures above model twelve monthly salaries rather than thirteen. Multiplying a monthly salary by thirteen would push a payment that carries neither tax nor contribution through both, and would overstate what leaves the payslip. Read the annual result as twelve ordinary months, and the thirteenth as reaching the employee close to whole below the ceiling.

Sources: Republic Act No. 10963 (TRAIN) · Presidential Decree No. 851 (1975)

A foreign national on a local contract

The Social Security Act makes coverage compulsory upon all employees, domestic workers included, who are not over sixty, with no nationality condition anywhere in the section. Pag-IBIG coverage then follows from it by design: its own membership circular covers "an expatriate who is not more than 60 years old and is compulsorily covered by the Social Security System (SSS), regardless of citizenship, nature and duration of employment, and the manner by which the compensation is paid".

PhilHealth is the one that the primary documents do not settle. The Universal Health Care Act includes every Filipino citizen automatically; the implementing circular lists employees among direct contributors without naming a nationality, while defining a member as all Filipino citizens; and the only PhilHealth instrument on foreign nationals routes them through the informal economy programme and predates that Act. The calculation above charges the premium to everyone, which is the position that understates nothing.

Sources: Republic Act No. 11199 (Social Security Act of 2018) · HDMF Circular No. 274 · Republic Act No. 11223 (Universal Health Care Act) · PhilHealth Circular No. 2020-0005 (Revision 1)

Non-resident, and the rule that turns on 180 days

A foreign national who is neither resident in the Philippines nor engaged in trade or business there, the two conditions being cumulative, is charged 25% on the whole of their Philippine-source income, with no band and no deduction. But section 25(A)(1) of the Tax Code DEEMS a non-resident alien who stays an aggregate of more than 180 days in a calendar year to be doing business here, "Section 22(G) of this Code notwithstanding", and taxes them on the graduated scale instead. The 180 days are therefore the hinge of a first partial year on assignment. The calculator models the graduated scale.

A rule still widely quoted is no longer law, and the reason is worth stating. The TRAIN law closed the 15% preferential rate of regional headquarters, regional operating headquarters, offshore banking units and petroleum service contractors to any such entity registering with the securities commission after 1 January 2018. The enrolled bill also carried a proviso preserving that rate for entities already registered, for their present and future qualified employees; the President struck that proviso by line-item veto on 19 December 2017, as violating the equal protection clause, writing that the employees of these firms should follow the regular rates applicable to other individual taxpayers. Copies of the Act that reproduce the enrolled text carry no veto annotation, which is how the struck half stays in circulation.

Sources: Republic Act No. 10963 (TRAIN) · Republic Act No. 8424 (National Internal Revenue Code) · Veto Message of the President on Republic Act No. 10963, 19 December 2017