BIR Form 1701-MS: The Simplified Annual ITR for Micro and Small Taxpayers
BIR Form 1701-MS is a simplified Annual Income Tax Return (AITR) created for individual taxpayers whom the Bureau of Internal Revenue classifies as micro or small taxpayers under Revenue Regulations (RR) No. 8-2024, issued to implement the taxpayer-classification provisions of the Ease of Paying Taxes (EOPT) Act, Republic Act No. 11976. The August 2024 revision of the form trims the schedules a purely self-employed micro or small filer has to complete compared with the standard BIR Form 1701 or 1701A layout, while still reporting the same income tax due for the year.
This guide covers who is classified as micro or small under RR No. 8-2024, how BIR Form 1701-MS differs from BIR Form 1701A and BIR Form 1701, how it fits alongside the CY2025 filing guidance in RMC No. 20-2026, and a worked eligibility check. For the broader choice among all annual ITR forms, see BIR Form 1700 vs 1701 vs 1701A vs 1702; for the tax-regime decision that usually comes first, see 8% Income Tax Rate vs Graduated Rates.
Organize Your Withholding Records Before Filing Season FREE →What is BIR Form 1701-MS? #
BIR Form 1701-MS is the Annual Income Tax Return for individuals whose gross sales or receipts place them in the “micro” or “small” taxpayer bracket that RR No. 8-2024 created for the EOPT Act’s size-based compliance simplifications. It is filed by self-employed individuals and professionals earning business or professional income — not by pure compensation earners, who continue to use BIR Form 1700.
Like BIR Form 1701 and 1701A, BIR Form 1701-MS reports income, deductions, and tax due for the calendar year and is generally due on or before April 15 of the following year, the same statutory deadline that applies to individual annual income tax returns under the NIRC as amended.
How are micro and small taxpayers classified? #
RR No. 8-2024 classifies taxpayers into four size tiers — micro, small, medium, and large — based on gross sales or receipts for the taxable year, counting only business or professional income. Compensation income, passive income taxed under separate Tax Code sections, and other income already subject to final tax are excluded from the gross sales figure used for this classification.
| Classification | Gross sales / receipts (taxable year) |
|---|---|
| Micro | Below ₱3,000,000 |
| Small | ₱3,000,000 up to below ₱20,000,000 |
| Medium | ₱20,000,000 up to below ₱1,000,000,000 |
| Large | ₱1,000,000,000 and above |
RR No. 8-2024 took effect April 27, 2026 — 15 days after its BIR website publication on April 12, 2026 — and the classification exists to calibrate compliance burden (return complexity, penalty amounts, and similar EOPT relief) to the size of the taxpayer rather than applying the same rules uniformly to a sole proprietor and a large enterprise.
Is BIR Form 1701-MS mandatory for micro and small taxpayers? #
No — BIR Form 1701-MS is an available, simplified option for micro and small taxpayers, not a forced substitute for BIR Form 1701 or 1701A. Under RMC No. 20-2026, which set the filing guidelines for the calendar year 2025 Annual Income Tax Return season, micro and small taxpayers may file using 1701-MS, 1701, or 1701A regardless of which form is indicated on their Certificate of Registration (COR). Medium and large taxpayers, by contrast, are required to file electronically using 1701 or 1701A — 1701-MS is not an option for them.
RMC No. 20-2026 also extended penalty relief specific to this transition: micro and small taxpayers faced no penalty for filing 1701 or 1701A electronically instead of the newer 1701-MS, and no penalty applied for filing in the “wrong venue” during the initial rollout period. This relief reflects that 1701-MS was a brand-new form for the CY2025 filing season, and the BIR did not want size-classification confusion to translate into filing penalties.
Can BIR Form 1701-MS be filed electronically? #
Yes, as of the update carried through RMC No. 36-2026. BIR Form 1701-MS was initially built around manual, paper-based filing for micro and small taxpayers — consistent with the EOPT Act’s broader intent to ease compliance burden for smaller filers. The BIR’s Offline eBIRForms Package version 7.9.6.0, released April 28, 2026 under RMC No. 36-2026, added BIR Form 1701-MS (August 2024 revision) to the electronic form set, and a related circular formally amended RMC No. 20-2026 to confirm electronic filing of 1701-MS through that package is allowed. A micro or small taxpayer today can therefore choose manual filing of 1701-MS, or electronic filing of 1701-MS, 1701, or 1701A — whichever fits their comfort level and RDO’s practice.
BIR Form 1701-MS vs BIR Form 1701A vs BIR Form 1701 #
The three forms overlap in who can file them, but 1701-MS is scoped specifically to the size classification, while 1701A and 1701 are scoped to income type and deduction method. Choosing correctly means checking both your income mix and your size bracket.
| BIR Form 1701-MS | BIR Form 1701A | BIR Form 1701 | |
|---|---|---|---|
| Who it targets | Micro/small taxpayers under RR No. 8-2024 gross-sales thresholds | Individuals purely self-employed/in a profession, under 8% rate or graduated rates with OSD | Mixed-income earners, itemized-deduction filers, estates, and trusts |
| Size restriction | Gross sales below ₱20,000,000 | None (based on income type and deduction method, not size) | None |
| Filing mode | Manual, or electronic via Offline eBIRForms v7.9.6.0+ | Electronic (eBIRForms/eFPS as applicable) | Electronic (eBIRForms/eFPS as applicable) |
| Applies to compensation income | No — business/professional income only | No — business/professional income only | Yes, if mixed with business/professional income |
A micro or small taxpayer who is purely self-employed under the 8% rate could, in principle, choose either 1701-MS or 1701A for the same year — the form choice under RMC No. 20-2026 is theirs, not dictated solely by the COR.
Worked example: checking eligibility for BIR Form 1701-MS #
A self-employed graphic designer reported ₱2,400,000 in gross receipts for calendar year 2025, with no other business registered under the same TIN and no compensation income for the year.
| Check | Result |
|---|---|
| Gross receipts for the year | ₱2,400,000 |
| RR No. 8-2024 threshold for “micro” | Below ₱3,000,000 |
| Classification | Micro taxpayer |
| Income type | Purely business/professional (no compensation) |
| Eligible forms under RMC No. 20-2026 | 1701-MS, 1701A, or 1701 (filer’s choice) |
| If she instead earned ₱8,500,000 in gross receipts | Falls in the ₱3,000,000–below ₱20,000,000 range — small taxpayer, still eligible for 1701-MS |
| If she instead earned ₱21,000,000 in gross receipts | Exceeds ₱20,000,000 — medium taxpayer, must file 1701 or 1701A electronically; 1701-MS is not available |
Because her 2025 gross receipts fall below the ₱3,000,000 micro threshold, she can choose the simplified BIR Form 1701-MS for her CY2025 AITR — but under RMC No. 20-2026, filing 1701A instead would not have been penalized either, since both options remain open to a micro taxpayer for that filing season.
Frequently asked questions #
What is BIR Form 1701-MS? #
BIR Form 1701-MS (August 2024 revision) is a simplified Annual Income Tax Return introduced under the Ease of Paying Taxes Act, Republic Act No. 11976, for individual taxpayers classified as micro or small taxpayers based on their gross sales or receipts for the year.
Who qualifies as a micro or small taxpayer for BIR Form 1701-MS? #
Under Revenue Regulations No. 8-2024, a micro taxpayer has gross sales or receipts below P3,000,000 for the taxable year, and a small taxpayer has gross sales or receipts of P3,000,000 up to below P20,000,000. Gross sales cover only business or professional income, excluding compensation, passive income, and other income already taxed under different Tax Code sections.
Is BIR Form 1701-MS mandatory for micro and small taxpayers? #
No. Under RMC No. 20-2026, micro and small taxpayers may still choose to file BIR Form 1701 or 1701A instead of 1701-MS, regardless of what appears on their Certificate of Registration, and the BIR waived penalties for micro and small taxpayers who filed 1701 or 1701A electronically instead of using 1701-MS.
Can BIR Form 1701-MS now be filed electronically? #
Yes. BIR Form 1701-MS was originally intended mainly for manual filing, but RMC No. 36-2026 added it to the Offline eBIRForms Package version 7.9.6.0, released April 28, 2026, and a related circular amended RMC No. 20-2026 to formally allow electronic filing of 1701-MS through that package.
How is BIR Form 1701-MS different from BIR Form 1701A? #
BIR Form 1701-MS is a shorter, simplified return specifically designed for micro and small taxpayers under RR No. 8-2024. BIR Form 1701A serves individuals earning purely business or professional income under the 8% flat rate or graduated rates with Optional Standard Deduction, regardless of size classification, and generally asks for more schedule detail than 1701-MS.
Summary #
BIR Form 1701-MS gives micro and small taxpayers — gross sales below ₱20,000,000 under RR No. 8-2024 — a simplified annual return option, but RMC No. 20-2026 makes clear it is a choice, not a mandate: those taxpayers may still file 1701 or 1701A instead, regardless of their Certificate of Registration. Since RMC No. 36-2026 added the form to the Offline eBIRForms Package v7.9.6.0, 1701-MS can also be filed electronically rather than only on paper. Check your gross sales against the RR No. 8-2024 thresholds and your income mix against BIR Form 1700 vs 1701 vs 1701A vs 1702 before deciding which form to file, and confirm whether the 8% rate or graduated rates produces the lower tax due either way.