Taxes for Freelancers: Everything You Need to Know
In 2025, the Philippines continues to experience significant growth in its freelancing sector. Estimates suggest that there are approximately 1.5 million registered freelancers in the country, a number that may be even higher when considering unregistered individuals . This surge is attributed to the increasing demand for flexible work arrangements, the rise of digital platforms, and the country’s highly skilled, English-proficient workforce. (Source: PIDS)
As freelancing becomes a more prominent career choice, it’s crucial for independent professionals to understand their tax obligations. Whether you’re a writer, designer, consultant, virtual assistant, or online seller, if you’re earning income through freelancing, you have responsibilities under Philippine tax laws.
This is one thing you can’t ignore: Taxes.
In this guide, we’ll explain everything you need to know about freelancer taxes in the Philippines for 2025 — and how you can make compliance simple and stress-free.
Do Freelancers Need to Pay Taxes?
Short answer: Yes.
If you are earning income in the Philippines — even as a solo freelancer without a physical office — you are required to register with the Bureau of Internal Revenue (BIR) and pay the appropriate taxes. If you’re doing this as a side business or “raket”, YES, you still need to pay taxes.
Freelancing = running your own business or running a business on the side.
That’s why you’re treated like a “self-employed professional” under the law.
How to Register as a Freelancer with the BIR
Here’s a simple step-by-step guide:
1. Secure a Tax Identification Number (TIN)
- If you don’t have a TIN yet, apply using BIR Form 1901. Why a form 1901?
- Form No. 1901 – for self-employed and mixed-income individuals, non-resident aliens engaged in trade or business, and estates and trusts.
- Form No. 1902 – for individuals earning purely compensation income (local and alien employees)
- If you already have a TIN (from employment), you’ll update your information (changing status to self-employed) and get a Certificate of Registration for your business from the BIR.
2. Register Your Freelance Activity
- Go to your assigned Revenue District Office (RDO).
- Submit BIR Form 1901, a copy of your valid ID, and proof of address (e.g., Barangay Certificate, Lease contract or title of your property).
- Pay the ₱500 registration fee and ₱30 documentary stamp tax.
- Receive your Certificate of Registration (COR) (Form 2303).
3. Register Your Books of Accounts
- You’ll need ledgers or journals for tracking income and expenses.
4. Apply for Official Invoices (previously called ORs or Official Receipts)
- If your clients ask for an OR, now called Service Invoices or Invoices, you’ll need an Authority to Print (ATP) and have these printed by a BIR-accredited printer.
👉 Full guide here: How to Get Your COR from BIR (2025)
What Taxes Do Freelancers Need to Pay?
Freelancers usually pay these taxes:
| Tax Type | Description |
|---|---|
| Income Tax | Based on your net earnings (after allowable deductions if you opt to use the graduated income tax rate table) or gross receipts (if you opt for 8% tax rate) |
| Percentage Tax | 3% of gross sales/receipts if you don’t choose the 8% tax rate (for non-VAT registered individuals) |
| VAT (for big earners) | Only if you earn ₱3 million and above annually |
The 8% Income Tax Rate for Freelancers
You may qualify for the simplified 8% flat income tax rate if:
- You are an individual (not a partnership or corporation) non-VAT taxpayer
- Your gross receipts do not exceed ₱3 million annually
- You opt for it by marking it in your first quarterly tax filing, your first quarterly percentage tax filing OR you have it indicated in your COR.
👉 Pro Tip:
Most new freelancers find the 8% option easier (and cheaper) than computing regular graduated tax rates.
When Should Freelancers File Their Taxes?
Stay on top of these filing deadlines:
| Tax Type | Due Date |
|---|---|
| Quarterly Income Tax (1701Q) | May 15, August 15, November 15 |
| Annual Income Tax (1701) | April 15 of the following year |
| Quarterly Percentage Tax (2551Q) or VAT (2550Q) | April 25, July 25, October 25, January 25 of the succeeding year for the last quarter) |
Common Freelancer Tax Mistakes
- Not registering with the BIR before accepting freelance gigs
- Ignoring tax deadlines especially of they did not earn income for a specific quarter (you will still need to file the form)
- Not sending/keeping official invoices or proper records
- Thinking you’re “too small” to be noticed by the BIR
- Failing to track and declare ALL sources of freelance income (This sometimes results in banks freezing your accounts since they have no record of where income comes from)
How Can Taxumo Help Freelancers?
Paying your taxes doesn’t have to be overwhelming.
With Taxumo, you can:
✅ File and pay your taxes online — everything from preparation, to filing to payment are all done online
✅ Get automatic tax calculations based on your freelance income; Taxumo even has this “Estimate tax” feature which is FREE when you sign up, so you will have an idea of how much your approximate taxes will be
✅ Stay updated on deadlines (no more penalties!) Each tax card contains the clear due date on when it is due.
✅ Access a user-friendly dashboard to track your taxes; Simple encoding — just the way we like it!
Taxumo is trusted by thousands of Filipino freelancers who want to stay compliant without the stress.
FAQs About Freelancer Taxes in the Philippines
1. I just started freelancing this year. Do I need to register right away?
Yes, freelancers must register with the BIR as soon as they start earning.
2. What happens if I don’t register?
You may face penalties, surcharges, interest charges, and legal issues. Especially if you have clients who are giving you 2307 forms and withholding from your payment, you will NEED to register right away.
3. Can I still use Taxumo even if I haven’t registered yet?
Yes! You can already file your taxes using Taxumo, while processing your registration. For registration assistance, check out think link: https://marketplace.taxumo.com/products/registerpro
📋 Quick Summary
| What Freelancers Need to Do | |
|---|---|
| Register with the BIR | Secure a COR, ATP, Booklets of Invoices and Stamped Books of Accounts |
| Choose your tax rate | 8% income tax or percentage or graduated income tax rate |
| File taxes on time | Check COR Tax Types and then check the Quarterly and annual due dates |
| Use tools like Taxumo | Simplify tax preparation, filing and payment and avoid penalties |
Taxumo: Perfect for Freelancers! Try it out now.