Freelancers with a full-time job often get confused about taxes. One wrong tax type can lead to penalties or wrong filings. This topic matters because changing tax types affects your BIR records. It also affects how you file and pay income tax.
If you are a mixed income earner using the 8% rate, this guide is for you.
What Is an 8% Mixed Income Earner?
An 8% mixed income earner is someone who earns from: • Employment income, and • Freelancing or business income
The 8% tax rate applies only to your business or professional income. Your compensation income is still taxed using graduated rates.
Why This Matters to Freelancers
Your BIR Certificate of Registration (COR) must reflect your tax type. If your COR is outdated:
- You may file the wrong tax returns.
- You may miss required filings.
- You may face penalties during audits.
Correct records mean smooth compliance.
How to Change Tax Type for 8% Mixed Income Earner
Follow these steps:
- Decide to shift to the 8% income tax option.
- Check your current COR (BIR Form 2303).
- Visit your registered RDO.
- Request an update of tax type.
- Submit the required BIR form.
- Receive your updated COR.
This ensures your filings match your chosen tax rate.
8% Mixed Income Earner: Do You Need to Update COR?
Yes.
If you change your tax type, you must update your BIR COR. The COR lists all taxes you are required to file.
If the 8% tax is not reflected:
- You may still be required to file percentage tax.
- Your filings may be inconsistent.
When and Who Should Update Their COR?
You should update your COR if you are:
- A mixed income earner shifting to 8%.
- Previously under graduated rates.
- Removing percentage tax filings.
Best timing:
- At the start of the taxable year.
- Before filing your first quarterly return.
Practical Tips for Freelancers
- Always review your COR yearly.
- Align your tax type with your actual income.
- Keep copies of old and updated CORs.
- Do not assume 8% applies automatically.
- Ask your RDO if unsure.
Choosing the 8% tax rate is helpful. But it only works if your records are correct.
For every 8% mixed income earner, updating your COR is not optional. It is the key to clean, stress-free tax compliance.
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