How to use the commission calculator
- 1Choose "Flat rate" if one percentage applies to all sales, or "Tiered" if the rate goes up as sales grow.
- 2Enter your total sales for the period, such as a month or quarter.
- 3For a flat rate, enter the percentage. For tiers, choose how many and enter each tier's upper limit and rate. The last tier covers everything above.
- 4Add your base pay for the same period if you have one, or leave it empty.
- 5Read your commission, effective rate and total pay. In tiered mode the table shows what each band earned.
Flat rate commission
The simplest plan pays one percentage on every sale. Multiply sales by the rate. $85,000 in sales at 5% pays $4,250.
Check what "sales" means in your plan. Some pay on revenue invoiced, some on cash collected, and some on gross profit rather than sales value. Enter whichever figure your plan uses.
Commission = Sales × Rate ÷ 100
Tiered commission works like tax brackets
In a tiered (or graduated) plan each rate applies only to the sales inside its band. With 3% up to $25,000 and 5% from $25,000 to $50,000, a $40,000 month earns 3% on the first $25,000 and 5% on the next $15,000. Moving into a higher tier never lowers what you earned on earlier sales.
Some plans work differently and pay the higher rate on all sales once a target is reached. That is sometimes called a retroactive or "step" plan. This calculator uses the marginal method; for a step plan, use flat rate mode with the rate you reached.
Commission = Σ (Sales within each tier × Tier rate ÷ 100) Effective rate = Commission ÷ Sales × 100
Base pay plus commission
Many sales roles combine a base salary with commission. Enter base pay for the same period as your sales, so a monthly base for monthly sales. All figures are before tax and other deductions, which depend on where you live.
Total pay = Base pay + Commission
Worked example
A sales rep sells $85,000 in a month on a four-tier plan (3% up to $25,000, 5% up to $50,000, 7% up to $100,000, 10% above) with a $2,000 monthly base.
| First $25,000 at 3% | $750.00 |
| Next $25,000 at 5% | $1,250.00 |
| Next $35,000 at 7% | $2,450.00 |
| Above $100,000 at 10% | $0.00 |
| Total commission | $4,450.00 |
| Effective rate | 5.24% |
| Total pay with $2,000 base | $6,450.00 |
The rep earns $4,450 in commission, $200 more than a flat 5% would pay ($4,250), and $6,450 in total before tax.