Last updated: November 11, 2026
BIR Form 2307 is the Certificate of Creditable Tax Withheld at Source. When a client withholds income tax from what it pays a freelancer, professional or supplier, it issues a 2307 to prove the tax was withheld. The payee then uses the certificate as a credit against their own income tax. This guide explains who issues it, when, the usual withholding rates, how to claim the credit, and includes a calculator for the amount you actually receive.
- The payor (the client or company) issues Form 2307 to the payee (the freelancer, professional or supplier). It is not for employees, who receive BIR Form 2316 instead.
- The certificate is due within 20 days after the end of the quarter, and the payee can ask for it at the time of payment.
- For professional fees the usual rates are 5% or 10% for individuals and 10% or 15% for companies, depending on income and VAT status.
- The withheld amount is claimed as a tax credit in the quarterly and annual income tax returns. Keep every certificate, because without it the credit can be denied.
- Since late 2025, certain large withholding agents also withhold 1% on goods and 2% on services under RR 24-2025.
What Is BIR Form 2307?
Form 2307 is issued by a withholding agent, the party that pays income and must deduct tax before paying. It shows the payee, the payor, the quarter, the income paid, the tax withheld and the tax rate. Because the tax is withheld on account of the payee’s final income tax liability, the payee deducts it from the tax they owe. It is called creditable because it is a credit, unlike final withholding tax, which is the end of the payee’s liability for that income.
Who Issues and Who Receives a 2307?
- Issued by: companies and other withholding agents that pay for professional services, rent, contractor work, goods or services where the law requires creditable withholding.
- Received by: freelancers, consultants, professionals, contractors and suppliers.
- Not for employees: employee compensation is covered by the withholding on compensation and documented on BIR Form 2316.
If you are a foreign company paying a Filipino freelancer directly, the Philippine withholding rules generally apply only to payors that are registered withholding agents in the Philippines. This is one reason many overseas companies use an Employer of Record and put the worker on payroll instead.
BIR Form 2307 Deadline
| Quarter of payment | Certificate due from payor |
|---|---|
| January to March | April 20 |
| April to June | July 20 |
| July to September | October 20 |
| October to December | January 20 |
The rule is a 20-day window after quarter-end under Section 2.58(B) of Revenue Regulations 2-98 as amended by RR 11-2018. If the payee requests it, the payor must give the certificate at the time the income payment is made. The form is now referred to as the Certificate of Creditable Tax Withheld at Source, and electronic signatures are accepted under RMC 29-2021.
Common Withholding Rates on Professional Fees
| Payee | Condition | Rate |
|---|---|---|
| Individual professional or freelancer | Gross income of ₱3 million or less for the year, with a sworn declaration submitted to the payor | 5% |
| Individual professional or freelancer | Gross income above ₱3 million, or VAT-registered, with or without a declaration | 10% |
| Company or partnership | Gross income of ₱720,000 or less for the year | 10% |
| Company or partnership | Gross income above ₱720,000 | 15% |
These rates come from Section 2.57.2(A) of RR 2-98 as amended by RR 11-2018, with the VAT-registration rule from RR 14-2018. Without a sworn declaration, an individual whose income is within the threshold may be withheld at the higher rate, so freelancers should give each client the declaration at the start of the engagement. Some individuals who receive payments from a single payor below ₱250,000 in a year are not subject to withholding.
Other rates exist for rent, contractors, commissions and other payments. For goods and services, large withholding agents have withheld at 1% on goods and 2% on services since October 10, 2025 (RR 24-2025), with a reduced 0.5% for certain manufactured goods bought for wholesale. These rates apply only to the withholding agents the regulation names, so confirm with your accountant whether a particular client is covered.
Withholding Calculator
Enter the amount before VAT, pick the rate that applies, and see the tax withheld and the cash you receive.
Worked Example
A freelance designer who is not VAT-registered earns less than ₱3 million a year and has given the client a sworn declaration. She invoices ₱50,000 for a project. The client withholds 5%, which is ₱2,500, and pays her ₱47,500. The client issues a 2307 showing ₱50,000 income and ₱2,500 tax withheld. When she files her quarterly return she reports the ₱50,000 as income and subtracts the ₱2,500 as a credit.
How to Claim the Credit
- Collect a 2307 from every client that withheld tax, every quarter.
- Check the name, TIN, address, quarter and amounts on each certificate before filing.
- Enter the total withheld on the credits schedule of the quarterly income tax return (BIR Form 1701Q for individuals) and attach the certificates. If you have several clients, a summary alphalist of withholding agents (SAWT) may be required.
- On the annual return (BIR Form 1701 or 1701A), report all four quarters' certificates in the credits schedule. Excess credits can be carried over or refunded under the rules in the return.
- Keep the originals with your books and records. They are the proof of your credit.
The credit applies whether you pay income tax on the graduated rates or choose the 8% option. Withholding is only a prepayment, so you still file the returns.
What Is on a BIR Form 2307
- The period covered by the certificate (the quarter).
- The payee's name, TIN and address.
- The payor's name, TIN and address.
- A breakdown of the income paid by month, the tax rate or ATC, and the amount of tax withheld.
- The signature of the payor's authorized representative (an e-signature is accepted).
New Invoice Rule for Withholding
Under RR 6-2026, published on the BIR website on October 1, 2026, invoices must show the creditable withholding tax as a separate line where it applies. Existing unused invoices can be used until they run out if "Less: Withholding Tax" is stamped on them. Freelancers and suppliers who invoice withholding agents should update their invoice templates.
Common 2307 Problems
- Client does not issue the certificate. Ask in writing, and keep proof of the request. Without a 2307 the credit can be disallowed, so do not wait until the annual return.
- Wrong rate. Giving no sworn declaration can lead to a higher rate than needed.
- Wrong details. A misspelled name or TIN, or the wrong quarter, can lead to a rejected credit.
- Missing quarter. A late certificate can be claimed in a later quarter only if the rules allow it, so follow up each quarter.
- Confusing 2307 with 2316. Employees get a 2316. A 2307 is for contractors.
Frequently Asked Questions
It is the Certificate of Creditable Tax Withheld at Source. A payor gives it to a payee to show that income tax was withheld from a payment. The payee credits the amount against their income tax.
The withholding agent: the company or other payor that deducted creditable withholding tax from a payment to a freelancer, professional, contractor or supplier.
Within 20 days after the end of the quarter, which means January 20, April 20, July 20 and October 20. You can also ask for it at the time of payment.
For professional fees, individuals are withheld at 5% if their gross income for the year is ₱3 million or less and they gave a sworn declaration, and at 10% if they exceed ₱3 million or are VAT-registered. Companies are withheld at 10% up to ₱720,000 and 15% above that.
Report the total on the credits schedule of your quarterly income tax return (1701Q) and annual return (1701 or 1701A), and attach the 2307 certificates. A summary alphalist of withholding agents may be needed if you have many clients.
Request it in writing and keep a copy. Without the certificate the BIR can disallow the credit. If the client keeps refusing, you can report it to the BIR through your Revenue District Office.
Form 2316 is for employees and shows compensation and the tax withheld by the employer. Form 2307 is for payees who are not employees, such as freelancers and suppliers, and shows creditable withholding tax on business or professional income.
Yes. Creditable withholding is only a prepayment. You report your full income in your returns and deduct the withheld amount as a credit, then pay any balance or carry over any excess.
