Sales commission calculator
Estimate variable commission, a fixed bonus and the effective commission rate on sales.
This choice applies to every calculator; amounts are not converted.
Sales commission
Enter revenue, the commission rate and, if needed, a threshold or fixed bonus.
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How does this tool work?
This calculator estimates total sales commission from revenue, commission rate, an optional threshold and a fixed bonus.
Commissionable revenue is the portion of sales above the entered threshold.
Variable commission applies the selected rate to that amount.
The fixed bonus is then added to obtain total commission.
The calculation deliberately separates total revenue from the revenue that is actually commissionable. This makes it possible to model a trigger threshold and a fixed bonus without mixing compensation mechanisms. The final effective rate then provides a common basis for comparing different sales compensation plans on the same revenue.
How to use this tool
Enter revenue
Enter the amount of sales achieved.
Enter the rate
Specify the applicable commission percentage.
Add options
Optionally add a non-commissioned threshold and a fixed bonus.
Review commission
Variable amount, total commission and effective rate are calculated automatically.
Sales commission formulas
The variable commission applies to the share of revenue above the non-commissioned threshold; the fixed bonus is added on top.
Commissionable revenue
Commissionable revenue = max(0, Revenue − Non-commissioned threshold)
No commission is due below the threshold.
Total commission
Total commission = Commissionable revenue × Commission rate ÷ 100 + Fixed bonus
The first part is the variable commission.
Effective rate
Effective rate = Total commission ÷ Revenue × 100
Actual share of revenue paid out, threshold and bonus included.
- CA
- Revenue
- S
- Non-commissioned threshold
- E
- Commissionable revenue
- t
- Commission rate (%)
- B
- Fixed bonus
- C
- Total commission
The calculation uses a single rate; a tiered plan needs one calculation per tier.
Use cases
Calculate a sales bonus
Quickly estimate variable compensation linked to sales.
Test a threshold
Measure how a trigger threshold affects commission.
Compare commission plans
Compare several rates and bonuses on the same revenue.
Examples
€50,000 of sales with a €10,000 threshold
Only 50,000 − 10,000 = €40,000 is commissioned at 5%, i.e. €2,000, plus a €200 bonus: €2,200, or 4.4% of total revenue.
Input
Revenue: €50,000; Commission rate: 5%; Non-commissioned threshold: €10,000; Fixed bonus: €200Result
Commissionable revenue: €40,000; Variable commission: €2,000; Total commission: €2,200; Effective rate: 4.4%Tips and best practices
- Confirm whether the commission rate applies to all revenue or only to the portion above a threshold.
- Keep fixed bonuses separate from variable commission so different compensation plans remain easy to compare.
- Use the effective rate to compare different commission structures on the same amount of revenue.
Sources and references
- Weisstein E.W., Percent (opens in a new tab), Wolfram MathWorldPage in English
Frequently asked questions
How is sales commission calculated?
Variable commission equals commissionable revenue multiplied by the commission rate.
What is the threshold for?
It lets you pay commission only on the portion of revenue above a specified amount.
Is the fixed bonus included in the effective rate?
Yes. The effective rate compares total commission, including the bonus, with total revenue.
Is commission calculated before or after discounts?
It depends on the sales agreement. Use the commissionable revenue defined by your rules.
How does the non-commissioned threshold work?
The variable commission only applies to revenue above the threshold. With €50,000 of revenue, a €20,000 threshold and a 5% rate, the variable commission is 5% × €30,000 = €1,500. Below the threshold, only any fixed bonus is due.
What is the effective rate for?
It relates the total commission, fixed bonus included, to all revenue. It lets you compare pay plans built differently, for example a high rate with a threshold against a lower rate without one.
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