Calculator

OTE Calculator

Enter base salary and target variable pay to see on-target earnings, then move quota attainment to see what the plan really pays in a good or a bad year.

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Estimated earnings

Pay mix

Best next steps

Sales compensation calculator — broader plan model
Commission paycheck calculator — commission check estimate
What is OTE? — definition guide

Method note: Results are estimates. Always compare with your plan document, payroll rules and employer policy.

Last reviewed 20 August 2026

What does OTE mean?

OTE stands for on-target earnings: base salary plus variable pay, assuming you hit exactly 100% of quota. It is a projection of total annual cash compensation at target performance — not a salary, and not a guarantee. Only the base half is contractual; the variable half depends entirely on results and can be zero.

A “$120,000 OTE” role could mean $96,000 base plus $24,000 variable, or $60,000 base plus $60,000 variable. Those are very different jobs with the same headline number, which is why the split matters more than the total. The calculator below lets you see both halves and what happens to them at any level of attainment.

OTE vs base vs commission → Full OTE definition →

Go to the calculator ↓or keep reading for the formula

OTE formula

OTE = base salary + target variable pay at 100% attainment

Only the variable half moves with attainment; base salary is paid either way. That is why the pay mix behind an OTE figure matters more than the OTE figure itself.

Worked example: base salary plus on-target commission

A role with a $60,000 base and $40,000 on-target variable has an OTE of $100,000, a 60/40 split. If the rep hits 120% of quota and commission is linear, variable pay rises toward $48,000.

OTE = Base salary + On-target variable (commission/bonus)

Result

$100,000 OTE (60% base / 40% variable)

OTE assumes target attainment. Actual pay moves with quota performance.

Base salary

$60,000

On-target variable

$40,000

OTE total

$100,000

At 120% quota

~$108,000

Base and variable pay make up OTE; actual earnings move with attainment.

Base

$60,000

Variable

$40,000

OTE

$100,000

Pay mix

60/40

At 120% quota

~$108,000

Assumes

100% target

Typical OTE splits by role

The split reflects how much control the role has over the outcome. The less control, the higher the base should be.

Role	Base / variable	Why
Enterprise account executive	50 / 50	High control, long cycles, large deal values
Mid-market account executive	50/50 to 60/40	Shorter cycles, more volume
SDR / BDR	70 / 30	Activity-driven, limited control over closing
Sales engineer	75/25 to 80/20	Supports the deal rather than owning it
Customer success with a renewal number	80/20 to 90/10	Retention is largely product-driven
Sales manager	60/40 to 70/30	Team result, not personal quota

Compare the base, not the OTE. Two $120,000 OTE offers at 80/20 and 50/50 differ by $36,000 in guaranteed pay. In a year where the plan pays at 50%, the 80/20 role earns $108,000 and the 50/50 role earns $90,000.

Six questions that tell you whether an OTE is real

What percentage of the team hit quota last year? Above 60% and the OTE is broadly credible. Below 40% and it is a marketing number. A refusal to answer is itself informative.

Is there a threshold? Many plans pay nothing below 60–80% of quota. A high threshold plus a low base is the riskiest structure there is.

How was the quota set? Built up from territory history is defensible. A board number divided by headcount is not.

Is the plan capped? A cap removes the upside that justified the lower base. See tiers, accelerators and caps.

Is there a draw, and is it recoverable? A non-recoverable draw while you build pipeline is real money. A recoverable one is a loan against future commission.

When does commission pay? On booking, on invoice, or on cash collection? With 90-day payment terms, cash-collection plans delay your Q1 into Q2.

What OTE pays at each level of attainment

A $70,000 base with $30,000 target variable — a $100,000 OTE on a 70/30 split — with linear commission to target and a 1.5× accelerator above it.

50% of quota

$85,000

80%

$94,000

100% (OTE)

$100,000

120%

$109,000

150%

$122,500

Only the variable half moves. At 50% of quota the rep still earns 85% of OTE, because base salary does the heavy lifting on a 70/30 split.

That flatness is the whole argument for a high base. On a 50/50 split, the same 50% quota year pays $85,000 — but base is only $50,000, so a truly bad year is far worse.

Compare plans in the sales compensation calculator or check upside in the accelerator calculator.

Four ways people misread OTE

Treating it as salary on a mortgage application. Lenders typically want two years of evidenced variable income, and many count only half of it.

Assuming it is a ceiling. It is the target. Uncapped plans with accelerators routinely pay above OTE.

Comparing OTE to a bonus-bearing salary. A $120,000 OTE at 50/50 is far riskier than a $110,000 salary with a 10% target bonus.

Forgetting what base drives. Pension contributions, redundancy pay and borrowing capacity are usually calculated on base, not on OTE.

OTE questions

What does OTE mean?

On-target earnings: base salary plus variable pay assuming exactly 100% quota attainment. It projects total annual cash compensation at target performance and is not a guaranteed salary.

How do I calculate OTE?

Add base salary to target variable pay. If you know the OTE and the split instead, multiply the OTE by the base percentage for base salary and by the variable percentage for target commission.

Is OTE guaranteed?

No. Only the base salary component is contractual. The variable half depends on hitting quota and can be zero. Some offers include a guaranteed draw for the first quarter or two, guaranteed only for that period.

What is a good OTE split?

It depends on control. 50/50 is standard for quota-carrying account executives, 70/30 for SDRs and sales engineers, and 80/20 or 90/10 for customer success roles. Longer sales cycles and less control argue for a higher base.

Can I earn more than my OTE?

Yes, if the plan is uncapped or the cap sits above target. Accelerators above 100% attainment exist specifically to pay above OTE for overperformance.

Does OTE include bonuses and equity?

Usually only the quota-linked variable component. Company-wide annual bonuses, signing bonuses and equity are normally quoted separately, so confirm what a stated OTE contains before comparing offers.

What is OTE on a payslip?

Nothing - OTE never appears on a payslip. It is a planning figure used in offers and plan documents. Your payslip shows actual base salary and actual commission earned for that period.

Reviewed 20 August 2026 by the BonusPayCalc editorial team. Gross planning estimates only — not payroll, tax, legal or HR advice. See methodology for how formulas are chosen, or report a correction.