8% option

8% option — TRAIN’s annual election for self-employed individuals and professionals: a flat 8% on gross receipts above ₱250,000, in lieu of both graduated income tax and the 3% percentage tax, with radically simpler books (file 1701A). Available only while gross stays at or under the ₱3M VAT threshold, and elected on the year’s first quarterly filing. The crossover rule: 8% wins for high-margin service income (a lean digital agency, low-expense rentals); graduated-with-itemized wins when real expenses are heavy. The election is annual — run the math every January.

First used in: 2.7 · The tax layer