1. What is Commission-Based Pay?

Commission-based pay is a compensation model where earnings are directly tied to sales performance. In India, many sales professionals, real estate agents, and brokers receive commission as part or all of their income. This calculator helps determine net pay after TDS deductions.

2. How Does the Calculator Work?

The calculator uses these formulas:

Where:

• Sales Amount — Total value of sales in Indian Rupees (₹)
• Commission Rate — Percentage of sales paid as commission
• TDS — Tax Deducted at Source percentage as per Indian tax laws

3. Understanding TDS in India

Details: TDS (Tax Deducted at Source) is an income tax collection mechanism in India. For commission payments, TDS is typically deducted under Section 194H of the Income Tax Act at 5% (if PAN is provided) or 20% (if PAN isn't provided), unless the payer is an individual/HUF not liable for tax audit.

4. Using the Calculator

Tips: Enter sales amount in INR, commission rate as percentage (without % sign), and applicable TDS rate. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical commission rate in India?
A: Commission rates vary by industry but typically range from 1-10% for direct sales and up to 20-30% for high-value transactions like real estate.

Q2: Is TDS always applicable on commissions?
A: TDS applies when commission exceeds ₹15,000 in a financial year from a single payer (as per Section 194H).

Q3: How can I claim TDS deducted from my commission?
A: You can claim credit for TDS by filing your income tax return. The TDS amount appears in Form 26AS.

Q4: Are there exemptions from TDS on commission?
A: Yes, if you submit Form 15G/15H (for individuals below taxable limit) or have a lower/nil TDS certificate under Section 197.

Q5: What's the difference between TDS and TCS?
A: TDS is deducted from payments like commission, while TCS (Tax Collected at Source) is collected by sellers on certain goods.