The split
When you work under a host agency, the supplier’s commission is shared between you and your host. Your agreement sets your share. An 80/20 split, for example, means you keep 80% of the commission and your host keeps 20%.
So on a booking that earns $1,000 in commission, an 80% share pays you $800. That’s the first reason the money you receive is smaller than the commission on the invoice.
Tiers: earning a bigger share
Many hosts raise your share as you sell more, using a tier table. For example:
| Your sales this year | Your share |
|---|---|
| Up to $99,999 | 70% |
| $100,000 and up | 80% |
These numbers are only an illustration. Your host’s table will have its own bands and percentages.
What moves you up
Tier tables are counted in one of two ways:
- By sales: the total value of what you’ve booked. A $10,000 trip moves you $10,000 up the table.
- By commission: the commission you’ve earned. The same trip at 12% moves you $1,200 up the table.
The two can put you in very different places by mid-year, so it’s worth knowing which one your host uses.
Forward or retroactive?
This is the part that surprises people. When you cross into a higher tier, your host either applies the new rate going forward, or re-rates everything you’ve sold so far this year.
A worked example
Using the table above: you’ve sold $95,000 so far this year and earned $11,400 in commission at 70%. Your next booking is a $10,000 trip with $1,200 in commission, which takes you past $100,000.
| Forward | Retroactive | |
|---|---|---|
| This booking | Paid at the rate you were on: 70% of $1,200 = $840 | Paid at the new rate: 80% of $1,200 = $960 |
| Earlier bookings this year | No change | Re-rated from 70% to 80%: 10% of $11,400 = $1,140 extra |
| Bookings after this one | 80% | 80% |
On a retroactive basis, crossing that line is worth $1,260 more than on a forward basis in this example. That extra amount is often called a true-up. Your host may pay it with your next payment or separately, so ask how they handle it.
Other reasons the payment doesn’t match the invoice
- Non-commissionable amounts. Taxes, fees and any non-commissionable fare don’t earn commission. Commission is worked out on the commissionable part of the price only.
- More than one commission figure. Some confirmations show more than one commission amount. On at least one cruise line’s agent copy, a commission column shows a higher figure than the “Total Commission” that’s actually paid. Check which line your host pays on.
- GST/HST. Depending on your registration, GST/HST may be added to or included in what you’re paid.
- Changes, cancellations and clawbacks. A change to the booking can change the commission, and a cancellation after you’ve been paid can be taken back from a later payment.
- Timing. The supplier pays your host first, then your host pays you. See when suppliers pay commission.
Questions to ask your host
- Is my tier counted on sales or on commission?
- When I cross a tier, is it forward only or retroactive?
- Does my year run on the calendar, or from the date I joined?
- After a supplier pays you, when do you pay me?
- How are clawbacks and adjustments handled?
Every host agreement is different. Your agreement is what counts; this guide explains the common terms so you know what to look for.
Let the math do itself
Arrivals applies your host’s tier table as written, by sales or by commission, forward or retroactive. It works out your share on every booking, including true-ups when you cross a tier. See how it handles hosts.