How do I budget on commission income?

Work out a realistic average, set tax aside from each payment, and pay yourself a steady monthly draw below your average so good months build a buffer for lean ones. This calculator helps you set those figures.

How much tax should I set aside on commission?

Set aside around your marginal tax rate on the income that is not taxed at source. The calculator estimates the tax on your total income so you can reserve the right amount.

How do I cope with variable income?

Pay yourself a steady wage from a buffer rather than spending each payment as it lands. Budget around a conservative average, not a good month, so a quiet stretch does not catch you out.

Commission-Only Income Calculator

This calculator helps people paid wholly or partly on commission understand and budget their variable income. You enter your average sales, commission rate and any base, and it estimates your annual income, the tax to set aside, and a sustainable monthly draw to smooth the ups and downs. It is built for the reality of commission work, where income swings month to month, helping you plan around a realistic average rather than a good month.

Average monthly sales

Commission rate

Monthly base (if any)

Draw as % of average

suggested steady monthly draw to pay yourself

Average monthly income$0

Estimated annual income$0

Tax to set aside (monthly)$0

Income tax is estimated on your annual income using the 2025/2026 brackets; set that share aside from each payment. Paying yourself a steady draw below your average builds a buffer for lean months. This excludes ACC and GST, which may also apply. Estimate only, not tax advice.

How it works

The calculator works out your average monthly income as your sales times the commission rate, plus any base. It annualises that, estimates the income tax across the brackets, and shows the monthly tax to reserve. It then suggests a steady monthly draw at the percentage you choose of your average, so good months build a buffer that covers the quiet ones, the core discipline of managing commission income.

Worked example

On $40,000 average monthly sales at 8% commission, your average income is $3,200 a month, about $38,400 a year. The tax to set aside is roughly $530 a month. Drawing 80% of your average, you would pay yourself about $2,560 a month and let the rest build a buffer.

Related calculators

Budgeting on an Irregular Income guide: the buffer method.
Commission Calculator: work out commission.
Real Estate Commission Calculator: property commission.
Income Tax Calculator: tax on income.

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