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Sales Commission Calculator

Calculate flat, tiered, and quota-based commissions — then plan your deals-to-quota and project annual OTE.

Deal Information
$
%
Compensation Context (optional)
$
%
Commission = 10% × $10,000 = $1,000
COMMISSION EARNED
$1,000
Flat rate 10% on $10,000
Commission $
$1,000
Effective Rate
10.0%
Annual Projection
—
Earnings Breakdown
Base
Commission
Base Salary Commission
$
%
$
$
$
40
Deals to Hit Quota
40
Deals for 100% OTE
3.3
Deals / Month Needed
—
Days Left in Year
Progress to Quota
$0 YTD $200,000 Quota
$
$
%
Total Comp by Attainment
Attainment Sales $ Commission Total Comp
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How to Use This Calculator

1

Enter Sale Amount

Type the dollar value of the deal or sale in the Sale Amount field.

2

Choose Structure

Pick Flat Rate for a single %, Tiered for bands, Gross Margin for profit-based, or Quota-Based to track attainment.

3

Add Quota (Optional)

Enter your annual quota and YTD sales to see attainment % and progress bar in real time.

4

Read Your Commission

See Commission Earned, Effective Rate, OTE Progress, and Annual Projection instantly.

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Formulas

Flat Rate Commission = Rate × Sale Amount
Tiered Commission = Σ(ratei × bandi)
Gross Margin Commission = Rate × (Revenue − COGS)
Quota Attainment Attainment % = (Sales / Quota) × 100
OTE OTE = Base Salary + Target Commission
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Key Terms

OTE (On-Target Earnings)
Total expected compensation when a sales rep hits 100% of their quota. OTE = Base Salary + Target Commission.
Quota
The revenue target assigned to a sales rep for a given period, typically annual or quarterly.
Accelerator
A higher commission rate that kicks in after quota is exceeded — e.g., 15% on every dollar above 100% attainment.
Clawback
A provision requiring reps to return commission if a customer cancels or defaults within a specified period.
Draw vs. Guarantee
A draw is an advance on future commission (repayable if not earned). A guarantee is non-repayable salary replacement during ramp.
Ramp Period
A grace period (typically 3–6 months) for new hires with a reduced quota while they build their pipeline.
Effective Rate
For tiered commissions, the blended rate — total commission divided by total sale amount.
Gross Margin Commission
Commission calculated on profit (Revenue − COGS) rather than revenue. Encourages reps to protect margins.
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Real-World Examples

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Alex — SaaS Account Executive

$500K annual quota, 10% commission rate, $60K base salary

Quota
$500,000
Rate
10%
Base
$60,000
OTE at 100%
$110,000

At 100% quota ($500K in sales): $50K commission + $60K base = $110K OTE. At 150% attainment with a 1.5× accelerator: $135K commission + $60K base = $195K.

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Maria — Retail Sales Associate

3% commission on a $2,000 furniture sale

Sale Amount
$2,000
Rate
3%
Commission
$60

A flat 3% on $2,000 yields $60 commission. With tiered rates (2% on first $1K, 4% on the next $1K), the same sale earns $60 — but encourages larger transactions.

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Frequently Asked Questions

What is the difference between flat and tiered commission?

Flat commission applies a single rate to the entire sale (e.g., 10% on $50,000 = $5,000). Tiered commission applies different rates to different portions of the sale — the first $10K at 5%, the next $20K at 8%, and anything above at 10%. Tiered structures motivate reps to pursue larger deals.

How does gross margin commission work?

Instead of commissioning on revenue, gross margin commission pays a percentage of profit (Revenue − COGS). For example, 20% commission on a $10,000 sale with $6,000 COGS = 20% × $4,000 = $800. This aligns reps with company profitability and discourages deep discounting.

What is a draw against commission?

A draw is an advance paid to a new rep against future commissions. A recoverable draw must be repaid if the rep's commissions don't cover it. A non-recoverable draw (guarantee) forgives any shortfall — common during ramp periods to reduce financial risk for new hires.

What does OTE mean and how is it calculated?

OTE (On-Target Earnings) is total pay when a rep hits exactly 100% of their quota. OTE = Base Salary + Target Commission. If base is $60K and quota is $300K at 10% commission, OTE = $60K + $30K = $90K. OTE is used to benchmark and compare comp plans.

What is a commission accelerator?

An accelerator increases the commission rate after a rep exceeds quota. A common structure: 10% up to 100% attainment, then 15% on every dollar above quota. Accelerators are powerful motivators for over-performance and help companies attract top-tier talent.

What is a clawback clause?

A clawback requires a rep to return commission if a deal falls through — for example, if the customer cancels within 90 days or defaults on payment. Clawbacks are common in SaaS and financial services. They protect the company but can create cash flow uncertainty for reps.

How should I negotiate my commission plan?

First, research OTE benchmarks for your role and market using Glassdoor or Levels.fyi. Push for quota that is achievable (most reps should be able to hit it) — 60–70% attainment company-wide is a signal quota is too high. Ask about accelerators, ramp periods, and territory protection before signing.

What is a typical commission rate for B2B SaaS sales?

B2B SaaS commission rates typically range from 8–12% of ACV (Annual Contract Value). Mid-market AEs earning $80–120K base with $150–300K quotas earn OTEs of $150–250K. Enterprise AEs earn higher OTEs with larger quotas. Rates vary significantly by deal size, sales cycle length, and market segment.

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How to Negotiate a Commission Plan

Research Before You Negotiate

Before entering any comp discussion, benchmark your OTE against market data. Levels.fyi, Glassdoor, and LinkedIn Salary are strong starting points. Know the range for your role, company stage, and geography. A $90K OTE that looks good on paper at a Series A may be 20% below market for an enterprise AE role at a mature SaaS company.

Ask specifically: "What percentage of reps hit quota last year?" A healthy answer is 60–70%. If less than 50% of reps are hitting quota, either the quota is too high, the territory is bad, or the product has fundamental issues — all worth knowing before you sign.

Understand the Structure, Not Just the Number

OTE is a single number that masks significant structural differences. Two plans can both quote $150K OTE while paying very differently in practice. Evaluate: the base/variable split (50/50 vs 70/30), whether accelerators exist and when they kick in, how quota is set (bottom-up vs. top-down), territory carve-outs, and clawback terms.

A plan with a 1.5× accelerator above 100% attainment and a reasonable quota can yield $200K+ in a good year. A plan with no accelerator caps your upside even when you exceed targets. Ask for the plan document before accepting any offer.

Negotiate the Ramp Period

Ramp periods protect new reps while they build pipeline. A 3–6 month ramp with a 50–75% quota is standard for AE roles with 6–12 month sales cycles. Push for a guaranteed draw during ramp — ideally non-recoverable — so you're not financially penalized for a slow first quarter while prospects progress through your pipeline.

If the company refuses any ramp period and expects full quota from day one, factor that into your base salary ask. You'll need a larger cushion to carry you through the first few months of building.