Commission Calculator
Calculate sales commissions with flat, tiered, or split structures
Common Commission Structures
Flat Rate
Same percentage on all sales. Simple and predictable.
Example: 5% on all sales
Tiered / Graduated
Higher rates for higher sales. Incentivizes growth.
Example: 3% → 5% → 8%
Draw Against
Advance paid against future commissions. Provides stability.
Example: $3000/mo draw
How to Use This Commission Calculator
- Enter your total sales amount for the period
- Input your commission rate (e.g., 5% for a flat rate)
- Add base salary if you have a draw or guaranteed minimum
- Include any bonuses or accelerators that apply
- For tiered structures, set up each tier with its rate and threshold
- Click 'Calculate Commission' to see your total earnings
Example: On $150,000 in quarterly sales with a tiered structure (3% on first $50K, 5% on $50K-$100K, 8% above $100K), your commission would be $1,500 + $2,500 + $4,000 = $8,000. At a base salary of $4,000/month, that's $20,000 total quarterly earnings.
Tip: Use the Target Sales tab to work backwards from your income goal and see exactly how much you need to sell.
Why Use a Commission Calculator?
Commission calculations can get complex quickly, especially with tiered structures and accelerators. Getting the math right means knowing exactly what you'll earn.
- Calculate expected earnings before accepting a new sales role
- Determine how much you need to sell to hit a specific income target
- Compare different commission structures between job offers
- Track progress toward quota and accelerator thresholds
- Forecast monthly or quarterly earnings for budgeting
- Negotiate commission rates with concrete numbers
Understanding Your Results
Your commission calculation shows total earnings from sales activity. Compare your effective rate to industry benchmarks.
| Result | Meaning | Action |
|---|---|---|
| Effective rate 3-5% | Standard B2B range | Common for enterprise sales with high deal values |
| Effective rate 5-10% | Mid-market typical | Standard for SaaS, real estate, and retail sales |
| Effective rate 10-20% | High commission role | Often seen in insurance, high-margin products, or pure commission roles |
| Effective rate 20%+ | Premium commission | Typical for luxury goods, some financial products, or 100% commission positions |
Meaning: Standard B2B range
Action: Common for enterprise sales with high deal values
Meaning: Mid-market typical
Action: Standard for SaaS, real estate, and retail sales
Meaning: High commission role
Action: Often seen in insurance, high-margin products, or pure commission roles
Meaning: Premium commission
Action: Typical for luxury goods, some financial products, or 100% commission positions
Note: Effective rate = total earnings divided by total sales. Higher isn't always better—consider base salary stability and quota attainability.
About Commission Calculator
Formula
Commission = Sales Amount × Commission Rate For tiered structures, calculate each tier separately: (Tier 1 Sales × Tier 1 Rate) + (Tier 2 Sales × Tier 2 Rate) + ...
Current Standards: Average OTE (On-Target Earnings) in SaaS sales: SDR $70-90K, AE $120-180K, Enterprise AE $200-350K (2026 benchmarks). Typical quota attainment across industries is 50-60%.
Frequently Asked Questions
How do tiered commissions work?
Tiered commissions pay different rates for different sales thresholds. For example, 3% on sales from $0-$50,000, 5% on $50,001-$100,000, and 8% on everything above $100,000. The key point: you earn the lower rate on all sales in that tier, not the higher rate on all sales once you cross a threshold. This incentivizes pushing past quotas while preventing windfall payments on large single deals.
What's the difference between draw and base salary?
A base salary is guaranteed compensation you keep regardless of sales performance. A draw is an advance against future commissions. With a recoverable draw, you must 'pay back' the draw from earned commissions—if you draw $3,000 and earn $4,000 in commission, you receive $1,000. Non-recoverable draws are forgiven if commissions fall short. Draws provide cash flow stability but aren't truly 'free' money.
How are commission accelerators calculated?
Accelerators multiply your commission rate once you exceed 100% of quota. For example, a 1.5x accelerator means earning 7.5% instead of 5% on all sales above quota. Some companies apply accelerators to all sales retroactively once quota is hit; others only apply to sales above quota. Always clarify the exact structure—this difference can mean thousands of dollars.
What taxes apply to commission income?
Commission income is taxed as ordinary income at your marginal tax rate. Large commission checks often face higher withholding (up to 37% for supplemental wages over $1 million in 2026) because employers assume you might be in a high tax bracket. You'll reconcile the difference when you file taxes. Consider setting aside 25-35% of commission checks for taxes depending on your bracket.
Should I prioritize base salary or higher commission?
It depends on your risk tolerance and sales ability. Higher base provides stability but caps upside. Higher commission rewards top performers but creates income volatility. Consider: How predictable is your sales cycle? What's realistic quota attainment? How long is ramp time to full productivity? A 70/30 base-to-commission split offers balance; 50/50 or lower suits aggressive sellers in proven markets.