Commission Earnings Calculator with Tiers
Calculate commission earnings with tiered rates and see your potential income at different sales levels. Analyze commission structures and plan your sales targets with our comprehensive tiered calculator.
Quick Answer
Tiered Commission = Σ(Sales in Tier × Tier Rate). $50k sales at 5-10-15% tiers = $2,500 + $2,500 + $3,750 = $8,750. Higher tiers = higher rates. Essential for sales planning.
Calculator Preview
Commission Earned: $11,250
Total Compensation: $56,250
Commission Rate: 9%
Key Features
Tiered Rates
Multiple commission tiers
Sales Analysis
Earnings at different levels
Total Compensation
Base salary + commission
Quota Tracking
Sales goal monitoring
How It Works
Enter Sales Data
Input total sales and base salary
Set Commission Tiers
Define tier thresholds and rates
Calculate Earnings
System calculates tiered commission
See Results
View total compensation analysis
Why Calculate Tiered Commission?
Sales Planning
Set realistic sales targets
Income Projection
Forecast earnings
Compensation Analysis
Compare job offers
Common Commission Structures
3-Tier Structure
Most common. Example: 0-100k = 5%, 100k-200k = 10%, 200k+ = 15%. Rewards consistent performance and growth.
4-Tier Structure
More granular. Example: 0-50k = 3%, 50k-100k = 6%, 100k-150k = 9%, 150k+ = 12%. Provides more incremental rewards.
Accelerated Structure
Higher rates for top performers. Example: 0-80k = 5%, 80k-120k = 8%, 120k-180k = 12%, 180k+ = 20%. Encourages high performance.
Cliff Structure
All-or-nothing. Example: Under quota = 0%, Over quota = 10%. Creates strong incentive to meet quota.
Industry Commission Examples
Software Sales
Typical: 5-15% commission. Enterprise software often has 7-10% with accelerators. Average total comp: $100-200k.
Real Estate
Typical: 2-6% commission. Residential: 2-3%, Commercial: 4-6%. No base salary for most agents.
Automotive Sales
Typical: 15-25% commission. Based on profit margin, not sale price. Average total comp: $40-80k.
Insurance Sales
Typical: 8-15% commission. Higher for new business, lower for renewals. Average total comp: $50-100k.
Commission Calculation Examples
Example 1: $75k Sales, 3-Tier (5-10-15%)
Tier 1: $75k × 5% = $3,750
Total Commission: $3,750
Effective Rate: 5%
Example 2: $150k Sales, 3-Tier (5-10-15%)
Tier 1: $100k × 5% = $5,000
Tier 2: $50k × 10% = $5,000
Total Commission: $10,000
Effective Rate: 6.67%
Example 3: $250k Sales, 3-Tier (5-10-15%)
Tier 1: $100k × 5% = $5,000
Tier 2: $100k × 10% = $10,000
Tier 3: $50k × 15% = $7,500
Total Commission: $22,500
Effective Rate: 9%
Calculate Your Commission Earnings
Analyze tiered commission structures and plan your sales targets for maximum earnings
Use Full CalculatorFrequently Asked Questions
What's a good commission structure?
A good structure rewards performance fairly. 3-tier with 5-10-15% rates is common. Higher tiers should be achievable but challenging.
How are commissions taxed?
Commissions are taxed as regular income. They're subject to federal, state, and FICA taxes. Consider quarterly tax payments for large commissions.
Should I take a job with only commission?
Only if you have confidence in your sales ability and the market. Commission-only jobs offer unlimited earning potential but no guaranteed income.
How do I negotiate commission rates?
Research industry standards, consider your experience, and negotiate for higher rates or better tier structures. Document your past performance.