Sales Commission Calculator

What you take home on a commission scheme, with the fixed part, the base commission and the enhanced band once you beat the target.

Currency and number format for

You take home in total

—

You take home in total—

Of commission—

Base commission—

For beating the target—

Target—

Depends on sales—

How this was worked out

The formula

total = base pay + sales × base % + amount above target × enhanced %

Where it comes from

Almost every commission scheme has two bands: one percentage on everything sold and a better one on whatever goes past the target. The usual mistake is applying the enhanced percentage to the whole of the sales rather than only to the excess, which inflates expectations badly.

How to work it out by hand

Multiply the sales by the base percentage
If you beat the target, work out the excess by subtracting it from the sales
Multiply only that excess by the enhanced percentage
Add the base pay for the period and the two commissions

What is worth knowing

The figure worth looking at before accepting a sales role is not the commission but the weight of the variable part: how much of the total depends on selling. A scheme that is 70 % variable can pay very well in a good year and leave you below the minimum in a bad one. And watch for targets recalculated every quarter from the previous quarter's sales: the better you do, the harder the enhanced band becomes.

Frequently asked questions

Does the enhanced commission apply to all sales?

Almost never: it applies only to what goes above the target. If your contract says otherwise, put the same percentage in both fields.

What happens if I sell exactly the target?

You meet the target but the excess is zero, so you earn only the base commission. The enhanced band starts from the first unit above it.

How much variable pay is reasonable?

It depends on the sector, but above 50 % the salary stops being predictable. Always compare the bad scenario, not the good one.

Is commission taxed and does it count for contributions?

Yes, it is salary for all purposes in practically every country. This calculator works in gross amounts.