Commission Calculator
Calculate sales commission with flat or tiered rates. Add base salary, see effective commission rate and total earnings.
Enter your sales amount and commission rate to calculate earnings. Supports flat percentage or tiered commission structures.
How Sales Commission Structures Work
Commission is performance-based pay tied to sales results. The two main structures are flat rate (same percentage on all sales) and tiered (higher rates as you sell more). Most companies use tiered structures because they incentivise exceeding targets.
With tiered commission, you earn more per pound as your sales increase. Sell £10,000 at 5%, and you earn £500. But the next £40,000 might earn 8% (£3,200), and everything above £50,000 earns 12%. The accelerators reward top performers disproportionately.
Typical Commission Rates by Industry
| Industry | Typical Rate | Structure | Notes |
|---|---|---|---|
| Real estate | 1–3% | Flat per sale | Of property sale price |
| SaaS / software | 8–15% | Tiered, often with accelerators | Higher for new business vs renewals |
| Insurance | 5–15% | Flat or tiered | First-year premium; renewals lower |
| Retail (in-store) | 1–5% | Flat on upsells | Often on specific product categories only |
| Recruitment | 15–25% | Flat per placement | Of candidate's first-year salary |
What this means for you: Commission rates vary enormously by industry, deal size, and whether you're selling to new or existing customers. Always clarify: is the rate on revenue, gross profit, or contract value? The base can change your effective earnings significantly.
Flat vs Tiered: What You Actually Take Home
These numbers show why tiered structures exist. Same £100,000 in sales, very different payouts depending on how the tiers are set:
| Structure | How It Works | Commission on £100K |
|---|---|---|
| Flat 8% | Same rate on everything | £8,000 |
| Tiered (5/8/12%) | 5% on first £20K, 8% on next £30K, 12% above £50K | £9,400 |
| Accelerated (5/10/15%) | 5% to quota, 10% to 150%, 15% above | £10,500 |
| Decelerating | 12% first £30K, 8% next £30K, 5% above | £8,000 |
Accelerating structures reward overperformance — the more you sell past quota, the more each deal is worth. Decelerating structures cap your upside and are less common. If you're negotiating a comp plan, push for accelerators above quota.
Negotiating Your Commission Plan
Ask about OTE attainment. On-Target Earnings sound great on paper, but what percentage of the team actually hits quota? If only 20% reach OTE, the "expected" earnings are unrealistic.
Negotiate the accelerators, not just the base rate. A 2% higher accelerator above quota pays off massively if you're a strong performer, and costs the company nothing if you don't hit it.
Uncapped commission with clawbacks. "Uncapped" sounds great until you discover that cancelled deals or refunds claw back your commission months later. Understand the clawback window before signing.
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How to use this tool
Enter your total sales amount
Choose flat or tiered commission mode
Set your commission rate(s)
Common uses
- Calculating expected earnings from sales targets
- Comparing flat vs tiered commission structures
- Modelling income at different sales levels
- Understanding effective commission rates across tiers
- Planning total compensation with base salary plus commission
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