About the Commission Calculator
What is the Commission Calculator?
Many sales plans pay a base commission up to a target and a higher "accelerator" rate beyond it. This commission calculator splits sales at the target and applies each rate.
For commission paid to agents, it also deducts TDS at 2% under Section 194H when the year's commission exceeds ₹20,000. Commission paid to employees is taxed as salary instead.
How to use the Commission Calculator
- Sales Achieved (₹) (sample: 12,00,000)
- Commission Rate up to Target (%) (sample: 3)
- Sales Target (₹, 0 for no target) (sample: 10,00,000)
- Commission Rate above Target (%) (sample: 5)
- Paid To (sample: Commission agent (TDS u/s 194H))
- Press Calculate Commission (results also refresh as you type). The result card shows the Total Commission, along with Commission up to target, Accelerator commission above target, Effective commission rate and TDS u/s 194H (2%).
Formula used
Commission = min(Sales, Target) × Base rate + max(0, Sales − Target) × Accelerator rate
- TDS (194H) = 2% of the commission for resident agents, above ₹20,000 a year
Leave the target at 0 to apply a single flat rate to all sales.
Worked example
These are the sample values already filled in the calculator above, and the result it returns for them:
| Input | Sample value |
|---|---|
| Sales Achieved (₹) | 12,00,000 |
| Commission Rate up to Target (%) | 3 |
| Sales Target (₹, 0 for no target) | 10,00,000 |
| Commission Rate above Target (%) | 5 |
| Paid To | Commission agent (TDS u/s 194H) |
| Result | Value |
|---|---|
| Total Commission | ₹40,000 |
| Commission up to target | ₹30,000 |
| Accelerator commission above target | ₹10,000 |
| Effective commission rate | 3.33% |
| TDS u/s 194H (2%) | ₹800 |
| Net payout | ₹39,200 |
Tips for using the Commission Calculator
- Accelerators motivate over-achievement but should be priced so that extra sales remain profitable.
- Agents registered under GST add 18% GST on their commission invoice.