Commission Calculator

As a percentage of sales, often only above a threshold and often at rates that rise in tiers. £250,000 of sales with a £100,000 threshold leaves £150,000 commissionable, split across the tiers.

In a tiered plan each rate applies only to the sales inside its band. In a cliff plan, crossing a threshold applies the higher rate to everything. Cliffs pay far more at the boundary and are correspondingly rarer.

Sales as a percentage of your target. It usually drives accelerators — rates that step up above 100% — and it is the number most compensation plans are actually built around.

A higher commission rate that applies above quota, designed to reward over-performance disproportionately. It is why the top tier here carries the highest rate.

An advance against future commission, guaranteeing a minimum income. A recoverable draw must be paid back from later commission; a non-recoverable one does not. The difference matters enormously in a bad quarter.

That is set by the plan, and it varies: on order, on invoice, or on customer payment. Plans that pay on collection shift the credit risk onto the salesperson, and clawback clauses on refunds are common.

Base salary plus the commission you would earn hitting exactly 100% of quota. It is the figure recruiters quote, and it is a projection rather than a guarantee — ask what proportion of the team actually achieves it.

A provision reclaiming paid commission if a customer cancels, refunds or fails to pay within a period. Clawback windows of six to twelve months are common in subscription businesses.

Usually at a lower rate than new business, on the reasoning that renewals require less effort. Where renewals carry no commission at all, the incentive to service existing accounts disappears, which plans often discover the hard way.

A reduced rate above a very high attainment threshold, used to cap windfall payouts from an unusually large deal. It is unpopular for obvious reasons and is often replaced by a per-deal cap instead.

The plan decides, and the options are on order, on invoice, or on collection. Paying on collection shifts credit risk to the salesperson; paying on order shifts it to the company. Most plans compromise on invoice.

In jurisdictions using an average-earnings test for holiday pay, regular commission generally is. This has been contested and decided in favour of inclusion in several significant cases.