Commission Calculator
Sales commission from the sale amount and rate, with an optional tiered structure (higher rate above a threshold), base salary, and effective rate.
Commission Calculator: with the default inputs, commission earned is $2,500.00.
One deal, or the period's total sales if the plan pays on volume.
- Total earnings
- $2,500.00Base salary plus commission.
- Effective commission rate
- 5%Commission ÷ sales, after tiers and split.
- Commission at base rate
- $2,500.00
- Commission above threshold
- $0.00
- Commission before split
- $2,500.00
Assumptions
- Tiered rates are marginal — the higher rate applies only to sales above the threshold.
- Base salary and sales cover the same period.
- Pre-tax.
| Sales | Commission | Total with base | Effective rate |
|---|---|---|---|
| $25,000 | $1,250 | $1,250 | 5% |
| $37,500 | $1,875 | $1,875 | 5% |
| $50,000 | $2,500 | $2,500 | 5% |
| $62,500 | $3,125 | $3,125 | 5% |
| $75,000 | $3,750 | $3,750 | 5% |
| $100,000 | $5,000 | $5,000 | 5% |
How this is worked out
The formula
Flat: commission = sales × rate Tiered: commission = threshold × rate + (sales − threshold) × rate above threshold Your share = commission × split % Total earnings = base salary + your share Effective rate = your share ÷ sales
Open How it’s calculated above to see this worked through with your own numbers.
What you enter
- Sale amount (or total sales)
- One deal, or the period's total sales if the plan pays on volume.in dollars · 0 or more · defaults to 50000
- Commission rate
- A number.a percentage · from 0 to 100 · defaults to 5
- Tier threshold(under More options)
- Sales above this amount earn the higher rate. Leave 0 for a flat rate.in dollars · 0 or more · defaults to 0
- Rate above threshold(under More options)
- Applies only to the portion of sales above the threshold (marginal, like tax brackets).a percentage · from 0 to 100 · defaults to 8
- Base salary for the period(under More options)
- Guaranteed pay for the same period as the sales figure.in dollars · 0 or more · defaults to 0
- Your share of the commission(under More options)
- For split deals or brokerage splits (e.g. 70% agent / 30% broker).a percentage · from 0 to 100 · defaults to 100
What you get back
- Commission earnedmain answer
- Total earnings
- Base salary plus commission.
- Effective commission rate
- Commission ÷ sales, after tiers and split.
- Commission at base rate
- Commission above threshold
- Commission before split
What this assumes
- Tiered rates are marginal — the higher rate applies only to sales above the threshold.
- Base salary and sales cover the same period.
- Pre-tax.
About this calculator
A commission is a percentage of what you sell, and the simple version is one multiplication. Real plans are rarely that simple: rates step up once you pass a quota, brokerages take a split, and there's usually a base salary underneath. This calculator handles all of that and shows the effective rate — the one number that lets you compare two plans.
Flat vs. tiered plans
A flat plan pays the same rate on every dollar. A tiered plan pays a higher rate on sales above a threshold — and it matters whether the higher rate applies only to the excess (marginal, like income-tax brackets) or to the whole amount once you cross the line (retroactive, or "cliff"). This calculator models the marginal version, which is the more common and the fairer one. If your plan is retroactive, run it flat at the higher rate once you're over quota.
Enter the threshold and the upper rate under More options. The steps break the commission into the two tiers so you can see what the accelerator is actually worth.
Splits and base pay
Real-estate and brokerage plans pay a gross commission that's then split between the agent and the house (70/30 and 80/20 are common, and many brokerages move to 100% after a cap). Enter your share as the split. A base salary for the same period gives total earnings; in sales-comp language, base plus commission at quota is your OTE (on-target earnings).
Reading the results
- Commission earned is your take after tiers and split.
- Effective rate is commission divided by sales. On a tiered plan it rises as you sell more; on a plan with a split it's lower than the headline rate. Compare plans on this number at your realistic sales volume, not on the top-tier rate the recruiter quotes.
- The table shows earnings at half to double your current sales, which is the fastest way to see how much an accelerator rewards over-performance.
What it doesn't do
Draws against commission, clawbacks for cancelled deals, team overrides and SPIFs are all plan-specific and aren't modeled. Commission is also taxable as ordinary income; in the US it's often withheld at the 22% supplemental rate, which is not your actual tax rate.
Frequently asked questions
▸How do I calculate commission?
Multiply the sale amount by the commission rate as a decimal. A 5% commission on $50,000 is 50,000 × 0.05 = $2,500. For tiered plans, apply each rate to its own slice of sales and add them.
▸How does a tiered commission work?
Sales up to the threshold pay the base rate; sales above it pay the higher rate — usually only on the excess. 5% to $40,000 and 8% beyond it on $65,000 of sales is $2,000 + $2,000 = $4,000, an effective 6.15%.
▸What is a typical sales commission rate?
It varies by industry: 1–3% on real estate per side, 5–10% for many B2B products, 10–20% for services with low delivery cost, and 20–50% for some digital or affiliate products. Base salary and quota change what a fair rate is.
▸What does OTE mean?
On-target earnings: base salary plus the commission you'd earn at 100% of quota. A $60k base with $40k in commission at quota is $100k OTE. Actual pay depends on attainment.
▸How is commission taxed?
As ordinary income. In the US, employers often withhold a flat 22% on supplemental wages like commission, but your real rate is set by your total income when you file. Self-employed agents also owe self-employment tax.
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