How affiliate tax works
Four things every Shopee or TikTok affiliate deals with, in the order they happen.
Affiliate income makes you self-employed in the BIR's eyes. Register as a professional or sole proprietor and get your Certificate of Registration.
BIR Form 1901The 8 percent option taxes gross commissions above ₱250,000, simple and receipt-free. The graduated rates tax profit after expenses, plus 3 percent percentage tax on gross.
8% or graduatedPlatforms deduct creditable withholding tax before paying you. Collect BIR Form 2307 and subtract it from your tax due when filing.
prepaid taxCross ₱3 million in gross receipts and the 8 percent option disappears, replaced by VAT registration.
₱3M thresholdHow commissions get taxed
platform payouts, plainCommissions from Shopee, TikTok Shop, Lazada, and similar programs are self-employment income, so the BIR treats affiliate earnings the same as any other business income. You register with BIR Form 1901, file quarterly and annual returns, and pay under one of two regimes. Because the platforms report and withhold, the income is already visible to the BIR. The 8 percent option is the simpler route for anyone whose yearly receipts stay at ₱3 million or less.
The 8 percent option charges 8 percent of gross receipts above the first ₱250,000 and replaces both the income tax and the 3 percent percentage tax. On ₱600,000 of commissions that is 8 percent of ₱350,000, or ₱28,000 for the year, with no receipts to file. The graduated rates instead tax profit after documented expenses plus the 3 percent percentage tax, and they win only when expenses are large. If expenses stay under roughly half your commissions, the 8 percent usually costs less.
Platforms act as withholding agents. Since July 2024, Shopee and TikTok Shop deduct the 1 percent e-marketplace rate on half your commissions, about 0.5 percent of the total, once your yearly earnings through the platform pass ₱500,000. Talent and brand-deal fees instead use 10 percent, or 5 percent with a sworn declaration that your gross is at or under ₱3 million. It is a prepayment, so collect BIR Form 2307 and credit it when filing. For fees paid straight to you by clients, the freelancer tax calculator fits better, or compare with a salary using the income tax calculator.
Questions people ask
answered in plain wordsYes. Commissions from Shopee, TikTok, Lazada, and similar programs are self-employment income. You register with the BIR, file returns, and pay either the 8 percent option or the graduated rates. The platforms also report and withhold, so the income is visible to the BIR.
A simplified regime for self-employed individuals earning ₱3 million or less a year. You pay 8 percent of your gross receipts above ₱250,000, and that replaces both the regular income tax and the 3 percent percentage tax. No expense receipts needed.
When your documented business expenses are large relative to your income. The graduated table applies to your net income after expenses, so a low profit margin can beat the 8 percent on gross. As a rule of thumb, if expenses are under about half of your commissions, the 8 percent option usually wins.
Platforms are withholding agents. Since July 2024, Shopee and TikTok Shop deduct the e-marketplace rate of 1 percent on half your commissions, about 0.5 percent of the total, once your yearly earnings through the platform pass ₱500,000. Talent and brand-deal fees instead use the older 10 percent rate, or 5 percent with a sworn declaration that your gross is at or under ₱3 million. Either way it is remitted to the BIR under your name as a prepayment, not an extra tax.
Ask the platform for BIR Form 2307, the certificate of creditable tax withheld. Attach it when you file your quarterly and annual income tax returns; the withheld amounts are subtracted from the tax you owe. If more was withheld than you owe, the excess can be carried over or refunded.
You lose the 8 percent option, must register for VAT, and charge 12 percent VAT on your services. At that level the computation has more moving parts, and an accountant will earn their fee.
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Where these numbers come from
straight from the sourceThe rates and rules on this page follow the official issuances below. When an agency updates a schedule, this is where to confirm the current figure against your own situation.