Commission Calculator
Two tools in one: a simple percentage commission solved in any direction — give any two of price, rate and commission — and a tiered commission calculator for real pay plans, with an optional base commission, up to eight marginal tiers, and a tier-by-tier breakdown of where the money comes from.
Simple Percentage Commission
Tiered Commission Calculator
A base commission is paid regardless of whether a sale occurs.
Define the tiers — each rate applies only to the slice of sales inside its tier. Leave a "To" blank for no upper limit. A $ tier pays that flat amount when the tier is reached.
Tiers work like tax brackets: selling $27,000 under a 3%/5%/10% plan earns $1,050, not 10% of $27,000. The higher rate only ever touches the dollars inside its own tier — which is exactly why tiered plans motivate the next sale instead of punishing it.
Commission Structures, and What Each One Motivates
A commission ties a salesperson's pay to what they sell, aligning their income with the business's revenue. In its simplest form it is a percentage of the sale — 3% of a $100 sale pays $3 — but structures vary because each one motivates different behavior: plans that cut commission on discounted sales discourage discounting; plans that pay on repeat customers reward retention; plans based on profit rather than revenue reward selling the right things. Three structures cover most of the real world, and all three are computed on this page.
Commission Only
Pay is entirely a percentage of sales: compensation = sales price × commission rate. A real-estate agent at 3% on a $500,000 house earns $15,000 — and earns nothing in a month with no closing. The motivation is maximal and so is the income risk, which is why pure-commission roles cluster where individual effort visibly moves results.
Base Salary Plus Commission
A guaranteed base softens the risk while the percentage keeps the incentive: compensation = base + total sales × rate. A rep with a $500 monthly base at 1.5% who sells one $25,000 car earns $875; two cars, $1,250; a $25,000 car plus two at $33,000, $1,865. The base is typically lower than a comparable pure salary — selling remains necessary — but a bad month is survivable. Model it above with a flat-$ base commission and the fixed (non-tiered) commission.
Tiered Commission
The rate itself rises with volume, applied marginally: (t₁ × c₁) + (t₂ − t₁) × c₂ + … + (sales − tₙ₋₁) × cₙ, where each tier's rate prices only its own slice. The design goal is acceleration — every additional dollar of sales earns at least as much as the previous one, so the plan pushes hardest exactly where a flat plan would let a rep coast: just past each threshold. Employers should note the mirror image: a tier boundary is also where gaming concentrates (pulling next month's sales forward, splitting or bundling deals), and a well-drawn plan audits for it.
Frequently Asked Questions
Is commission taxed differently from salary?
In the U.S., no — commissions are ordinary income, often withheld at a flat supplemental rate (22% federal) when paid separately, then trued up on the annual return. The Income Tax and Take-Home Paycheck calculators here can model the net.
What is a draw against commission?
An advance the employer pays before commissions are earned, then claws back from future commission checks. It smooths income like a base salary but is a loan, not pay — if you leave with a negative draw balance, many agreements require repaying it.
Do both real-estate agents share one commission?
Typically yes: a total commission (often 5–6%) is split between the buyer's and seller's brokerages and then with the individual agents, which is why a "3% commission" on a listing usually means half of a 6% total. Enter the rate that applies to the side you are computing.
Related Calculators
Convert the whole package — base plus commission — across pay periods.
The employer's side: what a commission does to the margin.
What a commission check nets after withholding.
The discount a rep offers comes out of someone's number — see whose.