How do you calculate a sales commission rate from OTE?

Subtract base salary from OTE to get variable pay at target, then divide that by the annual quota. The result is what each dollar of revenue pays the rep. For example, a variable of $90,000 against a $600,000 quota gives a 15% commission rate.

What is a sales accelerator in a comp plan?

An accelerator is a higher commission rate that applies to revenue above 100% of quota. If the base rate is 15% and the accelerator multiplier is 1.5x, revenue above quota pays 22.5%. It rewards overperformance, so model it at high attainment levels before adding it to your plan.

Should a startup cap sales commissions?

A cap limits payouts at a set percentage of quota. It protects the company from a large windfall, but it can also discourage reps from closing more once they reach it. Many founders model both versions, with and without a cap, and decide based on deal size variability and budget.

Free template · Hiring & sales team

Sales Commission & OTE Calculator

Design a simple comp plan and see what a rep earns from 50% to 150% of quota.

Excel · 2 tabs

What's inside

Pay mix and commission rate from base, OTE and quota
An optional accelerator above 100% and a payout cap
Total pay at 5 attainment levels
A payout calculator for any month or quarter

Who it's for

Founders writing a first comp plan.

Why it matters

A first comp plan is often written in a hurry, with a base and an OTE figure but no clear view of what the rep actually earns if they hit half of quota or beat it. That gap causes problems later: plans that overpay on a lucky quarter, plans that feel unwinnable, or disputes about how a payout was calculated.

This spreadsheet turns three inputs, base salary, OTE and annual quota, into a pay mix and commission rate, then shows total pay at five attainment levels. You can test an accelerator above quota and a payout cap before committing, and calculate a payout for any month or quarter. The default numbers are placeholders, so replace them with current market data.

How to use it

1Open the Calculator tab and replace the yellow inputs with your annual base salary, annual OTE and annual quota in revenue.
2Check the calculated plan design: variable pay at target, base to variable pay mix, commission rate and quota as a multiple of OTE.
3Set an accelerator multiplier for revenue above 100% of quota and, if you want one, a payout cap, then compare total pay from 50% to 150% attainment.
4Use the This period box to enter a period length and revenue closed, and see the period quota, attainment and commission earned.
5Write the final plan down, including how deals are credited, when commission is paid, clawbacks and what happens on termination.

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Sales Commission & OTE Calculator: FAQ

How do you calculate a sales commission rate from OTE?: Subtract base salary from OTE to get variable pay at target, then divide that by the annual quota. The result is what each dollar of revenue pays the rep. For example, a variable of $90,000 against a $600,000 quota gives a 15% commission rate.
What is a sales accelerator in a comp plan?: An accelerator is a higher commission rate that applies to revenue above 100% of quota. If the base rate is 15% and the accelerator multiplier is 1.5x, revenue above quota pays 22.5%. It rewards overperformance, so model it at high attainment levels before adding it to your plan.
Should a startup cap sales commissions?: A cap limits payouts at a set percentage of quota. It protects the company from a large windfall, but it can also discourage reps from closing more once they reach it. Many founders model both versions, with and without a cap, and decide based on deal size variability and budget.

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