Be careful not to confuse
salary with
draw.
A draw is basically an advance against expected sales commission.
Try it this way -
Your draw is $2,500 monthly. you are given a check for $2,500 each month.
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So say in one month I sell $30,000 worth of sales, 15% of that is $4,500. So do I subtract the $2,500 from that $4,500, so is my commission for the month $2,000? On top of my (weekly) base salary paycheck?
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Yes this is typically the way it works in most cases.
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Originally Posted by Pico
say you only sold enough to earn $2,000, the company still pays you $2,500, basically covering the $500 you didn't make. However, next month if you earn $4,500 in commission, the company will keep that $500 difference and only pay you $4000.
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You also need to be aware of when commissions are calculated and paid. They can be monthly/quarterly.... They also may not pay you immediately. Commissions may be calculated on "cash in" - meaning they are based upon what is paid for not "sold."
You really need to know and understand all of this. Some companies are pretty shitty.
Also are you an employee or an "independent contractor"? If you are the latter, YOU are responsible for a lot more of your tax liability and I believe have to file quarterly. This affects your actual net earnings at the end of the year.