The Commission Calculator computes sales commission under the two structures most plans use: a flat rate on all revenue, or progressive tiers where each rate applies only to the revenue inside its band, like income-tax brackets. Enter revenue and your plan's rates, optionally a base salary, and it returns total commission, the effective (blended) rate, per-$10k-of-sales commission, and a tier-by-tier breakdown.
How It Works
Flat plans multiply all revenue by the single rate. Tiered plans slice revenue at each tier limit: the first slice earns the first rate, the next slice the next rate, and so on, and the calculator reports each slice's revenue, rate, and commission so the blended result can be audited line by line.
Parameters
| Input | Required | Meaning | |---|---|---| | Plan type | Yes | Flat or tiered | | Revenue | Yes | Eligible sales revenue for the period | | Flat rate | Flat plans | Single percentage applied to all revenue | | Tiers | Tiered plans | Upper limit and rate for each band; the last band is open-ended | | Base salary | No | Added to commission for total earnings and commission share |
Worked example 1: flat
Revenue of 20,000 of commission. With a 80,000, commission is 25% of total pay, and the plan pays 10,000 of sales. Those three views matter in different rooms: the rep watches total earnings, finance watches the 8% cost of sales, and a hiring manager compares the per-10k figure across plans.
Worked example 2: tiered
A plan pays 5% on the first 50,000 to 150,000. On 2,500; 100,000 x 8% = 6,000; total $16,500, an effective rate of 8.25%. Note the effective rate always sits between the lowest and highest tier rates, and quoting the 12% top rate as "my commission rate" overstates the plan by nearly half.
Reading a plan offer
Ask which revenue counts: booked, invoiced, or collected cash, and what happens on refunds and churn clawbacks (SaaS plans increasingly claw back commission when a customer cancels inside a window). Accelerators above quota are tiers by another name and belong in the tier table. Caps, rarely advertised, truncate the top tier. If you are comparing two offers, run the same three revenue scenarios (ramp, at-quota, stretch) through both plans; plans that look richer at stretch are often poorer at the at-quota outcome most reps actually land.
Designing tiers that behave
Tier boundaries create cliffs of motivation: a rep at $149,000 in the example earns 8% on the next dollar and 12% only after crossing, so deals get pulled forward or delayed across period ends. Smooth plans raise rates gradually; gaming is reduced by paying on collected revenue and by measuring the same tiers cumulatively across the year rather than resetting monthly. The breakdown table here is the audit tool: if a payout looks wrong, the slice-level figures show exactly where plan and payroll diverge.
Limitations
The calculator applies the structure you enter to a single revenue figure for one period. It does not model clawbacks, refunds, split commissions between reps, draws against commission, taxes, or currency conversion, and it assumes tier limits are cumulative thresholds in the order entered. Your signed plan document governs any dispute.
Draws, splits, and other plan furniture
Three features change real payouts without changing rates. A draw is an advance against future commission, recovered from later payouts; model it as a loan against your tier total, not as extra earnings. Split commissions divide one deal's commission between reps (an opener and a closer, or a rep and an overlay specialist), and each party's slice should be run through the tiers on the revenue share they are credited with, which is a plan-document question. Team tiers pool revenue before slicing, which smooths individual variance and changes who the top tier rate rewards. Enter the credited revenue you are actually measured on, and the calculator's breakdown will match your payslip's logic.
Frequently Asked Questions
Is commission calculated on revenue or profit?
Most sales plans pay on revenue (bookings or collected cash), which is what this calculator models. Some technical or resale plans pay on gross profit; convert the figures first if yours does.
What is the effective rate useful for?
It compresses a tiered plan into one comparable number: total commission divided by total revenue. Use it to compare plans and periods without re-slicing tiers each time.
Should base salary be included in commission rate?
No, and the calculator keeps them separate: the effective rate is commission over revenue, while total earnings and commission share of pay are reported as their own figures.