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How to calculate tiered sales commission in one formula

✓ Verified in LibreOffice 25.8.7.3 ✓ Verified in Google Sheets (2026-08-30)

Marginal commission tiers — each band pays its own rate, like tax brackets for sales.

The formula

AppFormulaNotes
Excel (desktop)=SUMPRODUCT(--(A2>D2:D4),(A2-D2:D4),E2:E4)D = tier thresholds (0, 10000, 25000), E = rate INCREASES at each threshold (0.05, 0.03, 0.02 for rates 5/8/10%).
Google Sheets=SUMPRODUCT(--(A2>D2:D4),(A2-D2:D4),E2:E4)Identical.
LibreOffice Calc=SUMPRODUCT(--(A2>D2:D4),(A2-D2:D4),E2:E4)Identical.

How it works

Same machinery as the progressive-tax recipe: store each tier's rate INCREASE (5%, then +3% to reach 8%, then +2% to reach 10%) and let SUMPRODUCT apply each increase to everything above its threshold. $30,000 in sales: 30,000×5% + 20,000×3% + 5,000×2% = $2,200 — matching the tier-by-tier math (10k@5% + 15k@8% + 5k@10%). Cliff-style plans (whole amount at the highest tier's rate) are different and simpler: a closest-match lookup gets the rate, then multiply.

Verified, not just documented

We ran =SUMPRODUCT(--(A2>D2:D4),(A2-D2:D4),E2:E4) in LibreOffice 25.8.7.3 (headless, with forced recalculation) and it returned 2200 — exactly the expected result. We then ran the same formulas in Google Sheets, executed 2026-08-30: a formula-only workbook goes into Google Drive, which converts it to a Sheet and recalculates every formula with Google’s own engine, and comes back out as .xlsx carrying the values Google computed. It returned 2200 for the worked example, the same value LibreOffice produced. Both engines’ numbers on this page are executed results. The Excel formula follows Microsoft’s official documented syntax — we do not run desktop Excel.

Functions used

SUMPRODUCT — see full Excel, Google Sheets & LibreOffice compatibility for each.

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