Commission Calculator
Calculate sales commission, total earnings, and the variable share of pay from a sales volume, commission rate, and optional base salary. Works for straight commission, salary-plus-commission, and tiered plans (run the tier separately).
Commission earned
£2,500.00
- Total earnings
- £2,500.00
- Base salary
- £0.00
- Sales volume
- £50,000.00
- Commission rate
- 5%
- Variable share of pay
- 100%
Commission = Sales × Rate. Total earnings adds any fixed base salary on top. The variable share of pay shows how much of total earnings depends on hitting sales — a 100% figure means pure commission with no base, and lower figures mean a more salary-heavy plan. Typical mixes: 100/0 for independent reps, 70/30 (salary-heavy) for inside sales, 50/50 for field sales, 30/70 for hunters.
How to use this calculator
Enter the sales volume the rep is being paid on (the qualifying revenue, not necessarily total sales — exclude returns and any non-eligible products if the plan says so), the commission rate as a percentage, and the fixed base salary if the plan has one. For a straight-commission plan leave base salary at zero. For a tiered plan, run the calculator once per tier — for example, 4% on the first £50,000 and 6% on the next £25,000 — and add the commissions together. Total earnings is commission plus base; the variable share shows how much of pay is at risk.
How the calculation works
Commission = Sales × Rate / 100. That is the entire formula — it is the same in every jurisdiction and every industry. Total earnings simply adds the base salary on top: Total = Commission + Base. The variable share of pay is Commission / Total × 100; a 100% figure means the rep is paid only when they sell, a 30% figure means most of their pay is guaranteed. Comp plans are typically described as "70/30" or "50/50" meaning the target ratio of base to variable when the rep hits quota.
Worked example
A field sales rep with a 50/50 plan: £40,000 base salary, target commission also £40,000, paid as 4% on £1,000,000 of qualifying sales. They close £1,200,000 — commission = 1,200,000 × 4% = £48,000. Total earnings = 48,000 + 40,000 = £88,000. Variable share = 48,000 / 88,000 = 54.5%, slightly above the 50% target because they over-performed.
Frequently asked questions
How do I calculate commission from a sales figure?
Multiply the sales figure by the commission rate (as a decimal), or by the percentage and divide by 100. For 5% commission on £20,000 of sales: 20,000 × 0.05 = £1,000, or equivalently 20,000 × 5 / 100 = £1,000. If the plan has a base salary on top, add it to commission to get total earnings. If the plan is tiered, calculate each tier separately and sum the commissions.
What is the difference between straight commission and salary-plus-commission?
Straight commission means 100% of pay comes from sales — no base salary, no floor. Common for independent reps, real-estate agents, and high-end B2B closers. Salary-plus-commission combines a guaranteed base with a variable component; this is the standard model for most field and inside sales roles and is described by a ratio like 60/40, meaning 60% of target earnings is salary and 40% is commission at quota. The variable share figure this calculator returns shows where the actual mix sits for the period you entered.
How do tiered commission plans work?
A tiered plan pays different rates at different sales levels. A common shape is an "accelerator": 4% up to quota and 6% above it, to reward over-performance. To use this calculator with a tiered plan, run it once for each tier and add the commissions. For 4% on the first £50,000 and 6% on the next £30,000: tier 1 = 50,000 × 4% = £2,000; tier 2 = 30,000 × 6% = £1,800; total commission = £3,800. The reverse shape — a "decelerator" with lower rates above a cap — also exists but is less common.
Is the commission rate applied to revenue, gross profit, or something else?
It depends on the plan. Most retail and SaaS plans commission on revenue (or bookings, for SaaS); industrial and distribution plans often commission on gross profit to align the rep with margin discipline; some service businesses commission on collected cash to align with working capital. Always check the comp plan document — the same 5% rate on revenue and on gross profit can mean very different earnings. When entering "sales volume" in the calculator, use whichever base the plan actually pays on.
What are typical commission rates by industry?
Rough bands: real estate 2.5–6% per side, insurance new-business 5–15% of first-year premium then a 2–5% trail, SaaS new-business 8–12% of ACV, financial-services product placement 0.25–1% of AUM, retail and consumer 1–5% of revenue, manufacturing and distribution 2–8% of gross profit, automotive sales £100–£500 per unit or 20–25% of dealer profit. These vary hugely with deal size, sales cycle, and whether the rep also gets a base — high rates usually mean no base, low rates usually come with a salary.
How are commissions taxed?
In the UK, commission is treated as employment income and taxed via PAYE at the rep's marginal Income Tax rate (20%/40%/45%) plus Class 1 National Insurance. HMRC may apply a higher emergency rate to a one-off large commission payment, which is reclaimable. In the US, commissions are "supplemental wages" — the IRS allows employers to either aggregate with regular pay and withhold normally or apply a flat 22% federal supplemental rate (37% above $1m year-to-date), plus FICA and state withholding. Either way, the calculator returns gross commission — net take-home will be lower.