Free Travel Agent Commission & Profit Margin Calculator

Travel agent commission is calculated by multiplying the commissionable booking value by the supplier commission rate. For example: a €5,000 commissionable booking at 12% yields €600 in gross commission. If your agency works through a host or consortium that retains a share of that commission, multiply the gross commission by your retention percentage to find the amount your agency keeps.

The commissionable amount is the portion of a booking on which the supplier pays commission. It is often, but not always, the same as the total client price. Taxes, government fees, airline surcharges and certain ancillary products are frequently excluded from the commissionable base. Your supplier contract or fare sheets should specify what is commissionable.

Commission and markup are different commercial models. Commission is remuneration paid by the supplier to the travel agency as a percentage of the commissionable booking value. The agency does not own the inventory - the supplier does. Markup is the difference between the supplier's net price (the cost the agency pays) and the client's selling price. The agency buys at net cost and sells at a higher price, retaining the margin.

Markup and margin are related but use different denominators - a common source of confusion. Markup measures profit relative to cost: Markup % = Profit ÷ Cost Margin measures profit relative to selling price: Margin % = Profit ÷ Selling price Example: buy at €1,000, sell at €1,200, profit = €200. Markup = €200 ÷ €1,000 = 20% | Margin = €200 ÷ €1,200 = 16.67% Always confirm which denominator a supplier or partner is using before comparing figures.

Two bookings generating identical commission can have very different economics depending on the work required to produce them. A straightforward package holiday booked in one hour and a complex multi-destination itinerary requiring ten hours of research, supplier negotiation, and three proposal revisions both appear equal in a commission report - but they are not equally profitable. Including advisor time makes the true economic cost visible. This is why the calculator separates revenue from contribution: contribution reflects what remains after the operational work required to generate that revenue.

Service and planning fees are common across established travel agencies. Common reasons agencies introduce them include: • Compensating research and planning effort on complex itineraries • Qualifying enquiries and reducing low-intent requests • Supporting products where supplier commissions are low or absent • Covering revision rounds on detailed proposals • Reflecting the advisory expertise being provided Fee structures vary widely. The appropriate fee depends on your agency's service model, client expectations, and the types of travel you specialise in. There is no universal benchmark. The break-even service fee shown in this calculator indicates the minimum additional fee that would move a booking from negative to neutral contribution, given the inputs you provided.

Yes - VAT is optional and off by default. Enable “VAT / TOMS Tax” in the Direct Costs, VAT & Advisor Labour section and set your rate (20% by default). When enabled, the tax is applied to your agency margin - retained commission + markup + service fees - not to the full client booking value. This follows the Tour Operators Margin Scheme (TOMS) treatment used across the UK and EU. The rate is treated as already included in the margin figures you enter, so the tax is extracted from that margin rather than added on top. The result is deducted from agency revenue before contribution, and is factored into the break-even service fee. Tax treatment still depends on your jurisdiction, business structure, and the nature of each service. This remains a booking-level commercial estimate, not tax advice.

The Tour Operators Margin Scheme (TOMS) is a special VAT accounting treatment for businesses that buy in and resell travel services without materially altering them. Under a normal VAT arrangement, a business charges VAT on the full sale price and reclaims VAT on its purchases. TOMS replaces that: the agency accounts for VAT only on its own margin - the difference between what the client pays and what the suppliers are paid - and cannot reclaim VAT on the travel services it bought in. That is why enabling VAT here taxes retained commission, markup and fees rather than the whole booking. A €5,000 booking with a €600 margin is taxed on the €600, not the €5,000. Whether TOMS applies to your agency, and at what rate, depends on your jurisdiction and how you contract with suppliers. Confirm with your accountant.

No. The calculator provides an operational estimate only. Consult a qualified accountant for financial, tax, and accounting guidance specific to your agency.