Commission Calculator

This calculator applies one flat rate to the whole sale: commission = sale amount × rate ÷ 100. With the defaults, a $10,000 sale at 5% earns $500 in commission, and the "net after commission" line shows the $9,500 left for the seller or the business before any other costs.

It does not handle tiers, splits, caps, draws or clawbacks. For those, use it once per piece of the calculation and add the results, as in the examples below.

Take a plan that pays 5% on sales up to $50,000 and 8% above that, and a rep who sells $80,000 in the period. The same words can mean three very different paychecks:

The graduated plan works out to an effective rate of 6.13%. To reproduce it here, run $50,000 at 5% and $30,000 at 8%, then add the two commissions.

A whole-amount tiered plan creates a cliff. At $49,999 in sales it pays $2,499.95; at $50,001 it pays $4,000.08. Two dollars of extra sales add $1,500.13 of commission, which can push reps to time deals around the threshold. A graduated plan at $50,001 pays $2,500.08. Plans use "tiered" and "graduated" loosely, so read whether the higher rate applies to all sales or only the part above the threshold.

Say a $10,000 sale has $6,500 of product cost, leaving $3,500 of gross margin. A plan paying 5% of the sale price earns $500. A plan paying, say, 15% of margin earns $525.

The difference shows up when the price is cut. Discount the deal to $9,000 and the gross plan still pays $450, while the margin plan pays only $375 (15% of $2,500). Margin-based plans make the rep share the cost of discounting; gross-based plans don't. For a margin plan, enter the margin, not the sale price, as the sale amount.

Also check what the plan counts as a sale: before or after returns, discounts, shipping and sales tax. Those definitions can change the base more than the rate does.

Splits are applied one after another. Say a $400,000 sale carries a 5% commission ($20,000), half goes to your side of the deal ($10,000), and your agreement with your brokerage gives you 70% of that. You take home $7,000 before taxes. Calculate the first step here, then multiply by each share.

A draw is an advance paid against future commission. Say your draw is $3,000 a month:

• Month 1: you earn $2,200 in commission. You are still paid $3,000, and with a recoverable draw the $800 shortfall carries forward.
• Month 2: you earn $4,500. The $3,000 draw and the $800 carried forward come off first, so you get $700 on top of the draw, $3,700 in total.

With a non-recoverable draw, the month 1 shortfall is not carried forward. Your contract decides which type you have and whether any unrecovered balance is owed if you leave.