Philippine Salary Tax Calculator 2019
Calculate your income tax based on the 2019 Philippine tax rates (TRAIN Law)
Comprehensive Guide to Philippine Salary Tax Calculation (2019)
The Tax Reform for Acceleration and Inclusion (TRAIN) Law, officially known as Republic Act No. 10963, significantly changed the Philippine tax system when it took effect on January 1, 2018. This guide focuses on the 2019 tax rates which remained consistent with the TRAIN Law provisions.
Key Changes Under TRAIN Law (2018-2019)
- Lower personal income tax rates for most taxpayers
- Increased tax-exempt threshold from ₱50,000 to ₱250,000 annually
- Simplified tax tables with progressive rates from 0% to 35%
- Removal of most personal exemptions (replaced with standardized deductions)
2019 Philippine Income Tax Rates (TRAIN Law)
| Taxable Income Bracket (₱) | Tax Rate | Tax Due (₱) |
|---|---|---|
| Not over 250,000 | 0% | 0 |
| Over 250,000 but not over 400,000 | 20% | ₱0 + 20% of excess over ₱250,000 |
| Over 400,000 but not over 800,000 | 25% | ₱30,000 + 25% of excess over ₱400,000 |
| Over 800,000 but not over 2,000,000 | 30% | ₱130,000 + 30% of excess over ₱800,000 |
| Over 2,000,000 but not over 8,000,000 | 32% | ₱490,000 + 32% of excess over ₱2,000,000 |
| Over 8,000,000 | 35% | ₱2,410,000 + 35% of excess over ₱8,000,000 |
How to Calculate Your Income Tax (Step-by-Step)
- Determine your gross annual income – This includes your basic salary plus any regular allowances (excluding de minimis benefits)
- Subtract non-taxable income – Certain benefits like 13th month pay (up to ₱90,000) and de minimis benefits are tax-exempt
- Apply mandatory deductions – Subtract SSS, PhilHealth, and Pag-IBIG contributions (these are deducted before tax calculation)
- Determine your taxable income – This is your gross income minus non-taxable income and mandatory deductions
- Apply the progressive tax rates – Use the 2019 tax table above to calculate your tax due
- Calculate your net income – Subtract the tax due from your taxable income
Standard Deductions and Personal Exemptions (2019)
Under TRAIN Law, personal exemptions were replaced with a standard deduction of ₱50,000 for all taxpayers, regardless of status. However, for 2019:
- Single/Married with no dependents: ₱50,000 standard deduction
- Head of Family: ₱50,000 standard deduction
- Additional exemption for dependents: ₱25,000 per qualified dependent child (maximum of 4)
Comparison: Pre-TRAIN vs TRAIN Law (2019)
| Income Level | Pre-TRAIN Tax (2017) | TRAIN Law Tax (2019) | Savings |
|---|---|---|---|
| ₱250,000 | ₱12,500 | ₱0 | ₱12,500 |
| ₱400,000 | ₱50,000 | ₱30,000 | ₱20,000 |
| ₱800,000 | ₱170,000 | ₱130,000 | ₱40,000 |
| ₱2,000,000 | ₱500,000 | ₱490,000 | ₱10,000 |
| ₱5,000,000 | ₱1,500,000 | ₱1,350,000 | ₱150,000 |
As shown in the comparison table, the TRAIN Law provided significant tax relief for lower and middle-income earners while maintaining progressive taxation for higher income brackets.
Common Tax Exemptions and Deductions (2019)
- 13th Month Pay – Up to ₱90,000 is tax-exempt
- De Minimis Benefits – Such as rice subsidy (₱2,000/month), clothing allowance (₱6,000/year), etc.
- GSIS/SSS Contributions – Fully deductible
- PhilHealth Contributions – Fully deductible
- Pag-IBIG Contributions – Fully deductible (up to ₱2,400/year)
- Retirement Benefits – Tax-exempt if received from BIR-registered plans
Frequently Asked Questions About 2019 Philippine Taxes
1. What is the minimum salary to pay income tax in 2019?
Under the TRAIN Law, individuals earning ₱250,000 or less annually (about ₱20,833 monthly) are exempt from income tax. This is a significant increase from the previous threshold of ₱50,000.
2. How are bonuses taxed in 2019?
Bonuses up to ₱90,000 are tax-exempt. Any amount exceeding ₱90,000 is subject to income tax based on the progressive rates. The tax is computed separately from regular compensation income.
3. Can I still claim personal exemptions in 2019?
No. The TRAIN Law replaced personal exemptions with a standard deduction of ₱50,000 for all taxpayers. However, you can still claim additional exemptions for qualified dependent children (₱25,000 each, maximum of 4).
4. How do I compute my tax if I have multiple employers?
If you have multiple employers, you should:
- Consolidate all your income from different employers
- Apply the standard deduction and dependent exemptions (if any)
- Use the progressive tax table to compute your total tax due
- File an annual income tax return (ITR) to settle any tax due or claim refunds
5. What happens if I don’t file my income tax return?
Failure to file your income tax return can result in:
- Penalties of ₱1,000 to ₱25,000 depending on the violation
- Interest of 20% per annum on unpaid taxes
- Possible criminal prosecution for tax evasion in severe cases
- Difficulties in processing loans, visas, or government transactions
Official Resources and References
For the most accurate and up-to-date information, refer to these official sources:
- Bureau of Internal Revenue (BIR) Official Website – Contains all tax forms, regulations, and updates
- Department of Finance (DOF) – TRAIN Law Resources – Official information about the Tax Reform for Acceleration and Inclusion Law
- Official Gazette – Full Text of RA 10963 (TRAIN Law) – Complete text of the tax reform law
Tips for Tax Planning in 2019
- Maximize tax-exempt benefits – Take full advantage of the ₱90,000 tax-exempt limit for 13th month pay and bonuses
- Contribute to retirement plans – Contributions to PERA (Personal Equity and Retirement Account) are tax-deductible
- Keep receipts for deductible expenses – If you’re self-employed or a professional, keep records of business expenses
- Consider itemized deductions – For some taxpayers, itemizing deductions may be more beneficial than the standard deduction
- File on time – The deadline for filing annual income tax returns is April 15 of the following year
- Use the BIR’s eServices – The BIR offers online filing and payment systems that can make tax compliance easier
Common Mistakes to Avoid
- Not updating your BIR Form 2305 – This form declares your dependents for additional exemptions
- Missing the filing deadline – Late filing incurs penalties and interest
- Underreporting income – All income should be declared, including side jobs and freelance work
- Not keeping proper records – Maintain receipts and documents for at least 5 years
- Ignoring tax notices – Respond promptly to any communication from the BIR
Conclusion
The 2019 Philippine tax system under the TRAIN Law represented a significant shift toward simpler, more progressive taxation. For most employees, the changes resulted in lower tax burdens, particularly for those earning less than ₱800,000 annually. However, it’s crucial to understand how the system works to ensure you’re paying the correct amount of tax and taking advantage of all available deductions and exemptions.
This calculator provides an estimate based on the information you input. For precise tax calculations, especially if you have complex financial situations, consult with a certified public accountant or tax professional. Always refer to the official BIR website for the most current tax regulations and forms.