Tiered Commission Calculator

About this calculator

Tiered commission structures pay salespeople a higher commission rate as they cross successive sales volume thresholds within a period, rather than a single flat rate on every dollar sold — for example, 5% commission on the first $50,000 in sales, 7% on the next $50,000, and 10% on everything above $100,000. Each tier’s rate typically applies only to the revenue that falls within that bracket, similar to how progressive income tax brackets work.

This structure is designed to reward and accelerate performance from top sellers, giving an escalating incentive to push past each threshold rather than coast once a base quota is hit. This calculator takes your total sales and the tier thresholds and rates, then calculates commission bracket by bracket to show the total commission earned and your effective (blended) commission rate across the whole sales amount.