Commission Calculator — Calculate Sales Commission
Calculate commission earned on any sales amount with base pay and commission rate.
Commission
$1250.00
Total Pay
$4250.00
Effective Rate
17.00%
Formula
**Commission Pay Formula**
Commission = Sales Amount × Commission Rate (%)
Total Pay = Base Salary + Commission
With tiered quota:
Commission = (Sales up to Quota) × Below-Quota Rate
+ (Sales above Quota) × Above-Quota Rate
Worked Example
**Example:** $3,000 base, $25,000 sales, 5% rate
Commission = $25,000 × 0.05 = **$1,250**
Total = $3,000 + $1,250 = **$4,250**
Effective Rate = ($4,250 ÷ $25,000) × 100 = **17%**
Frequently Asked Questions
What is a typical commission rate?
Rates vary widely: real estate 2.5-3%, insurance 5-10%, software sales 8-12%, retail 1-5%.
How does a tiered commission work?
A tiered structure pays different rates above and below a quota. For example: 3% on the first $20k of monthly sales, 6% on everything above.
Is commission subject to payroll taxes?
Yes. Commission income is wages subject to federal income tax withholding, Social Security, and Medicare (FICA).