Quick answer: A 2.5% commission on a 50,000 sale is 50,000 × 0.025 = 1,250; to earn 1,250 at 2.5% you need 50,000 of sales.
How it's calculated
Commission = sale amount × rate. The rate = commission ÷ sale. The sales needed for a target = target commission ÷ rate.
Add your base pay to see total earnings. For tiered plans (a higher rate above a threshold), work out each tier separately and add them.
Real-estate brokerage fees are commission too. In Saudi Arabia, Article 14 of the Real Estate Brokerage Law sets the fee at 2.5% of the price on a sale, or of the first year's rent on a lease, unless the parties agree otherwise in writing. Dubai has no set rate: the fee is what the brokerage contract states. VAT may be charged on the fee: see the Saudi VAT and UAE VAT calculators.
Worked examples
- 50,000 sale at 2.5%: 1,250
- Received 900 on a 30,000 sale: 900 ÷ 30,000 = 3%
- Target 5,000 at 4%: 5,000 ÷ 0.04 = 125,000 of sales
Frequently asked questions
Is commission calculated before or after VAT?
Usually on the price before VAT. VAT, where it applies, is then charged on the commission itself.
How do I handle a tiered commission?
Apply each rate to the part of sales in its band and add the results: for 5% up to 20,000 and 8% above, a 30,000 sale earns 1,000 + 800 = 1,800.
What is the seller's net?
The sale amount minus the commission, shown in the last tile.
How do I include my base pay?
Enter it in the base pay field. The total pay is base pay plus commission.
How much do I need to sell to reach a target?
Divide the commission you want by your rate. To earn 3,000 at 2.5%, you need 3,000 ÷ 0.025 = 120,000 of sales.
How do I find my rate from a payment?
Divide the commission by the sale value. 1,250 on a 50,000 sale is 1,250 ÷ 50,000 = 2.5%.