Configure Commission Plans¶

This guide explains how to configure a Commission Plan for the Incentive Compensation Engine.

A Commission Plan defines the overall commission context for a company and provides the plan under which Commission Rules are evaluated.

Before You Begin¶

Before creating a Commission Plan, make sure:

the company exists in ERPNext
the currency you want to use is available
you understand the period for which the plan should apply
you know which commission rules you intend to create under the plan

A plan should normally be configured before creating its Commission Rules.

Create a Commission Plan¶

Open:

Commission Plan → New

Configure the following fields.

Field	What to Enter
Plan Name	A clear, unique name for the plan
Company	The ERPNext Company for which the plan applies
Currency	Currency used for commission calculations and payouts
Valid From	Date from which the plan can apply
Valid To	Optional date after which the plan is no longer valid
Status	Draft, Active, Disabled, or Expired

1. Plan Name¶

Give the plan a descriptive name that makes its purpose immediately clear.

Good examples:

Standard Sales Commission
FY 2026-27 Sales Commission
Enterprise Sales Commission
North Region Sales Commission

Avoid generic names such as:

Plan 1
Test Plan
Commission

A meaningful name makes the plan easier to identify when configuring rules and investigating commission calculations.

2. Company¶

Select the ERPNext Company to which the plan belongs.

For example:

Company: Your Company

The commission engine uses the company when determining whether a plan is applicable to a Sales Invoice.

A plan configured for one company should not be expected to apply to transactions belonging to another company.

3. Currency¶

Select the currency used for commission calculations and payouts.

For example:

Currency: INR

The currency becomes part of the commission configuration and is also used when matching ledger entries for Commission Statements.

Use the currency appropriate for the company's commission process.

4. Valid From¶

Set the date from which the plan can apply.

For example:

Valid From: 2026-10-01

The plan can be considered for eligible transactions occurring on or after its validity start date.

When introducing a new commission configuration, use Valid From to clearly define when the new configuration becomes effective.

5. Valid To¶

Valid To is optional.

For a plan with a defined end date:

Valid From: 2026-10-01
Valid To:   2026-12-31

For an open-ended plan:

Valid From: 2026-10-01
Valid To:   —

Leaving Valid To empty allows the plan to remain open-ended rather than assigning it a predetermined expiration date.

6. Status¶

Select the appropriate plan status.

Available statuses are:

Draft
Active
Disabled
Expired

Draft¶

Use Draft while the plan is being configured.

A Draft plan is not an active commission configuration.

Active¶

An Active plan is available for commission evaluation when it also satisfies the required company and validity conditions.

Use Active when the plan is ready to process commissions.

Disabled¶

Use Disabled when a plan should no longer be used for new commission calculations but should remain available for reference.

Expired¶

Expired indicates that the plan's validity period has ended.

Recommended Setup¶

For a new plan that should begin on October 1:

Field	Example
Plan Name	Standard Sales Commission
Company	Your Company
Currency	INR
Valid From	2026-10-01
Valid To	Leave empty
Status	Active

After saving the plan, create the Commission Rules that belong to it.

Plan Selection¶

The commission engine considers active plans that match the Sales Invoice's company and transaction date.

When more than one active plan is valid for the same transaction date, the plan with the most recent Valid From date takes precedence.

For example:

Plan A
Valid From: 2026-01-01

Plan B
Valid From: 2026-10-01

For a transaction dated:

2026-10-15

the newer plan is selected:

Plan B

This allows a new plan to take over from an older plan at a defined effective date.

Replacing an Existing Plan¶

When introducing a new commission configuration, create a new plan with its own Valid From date rather than modifying historical commission calculations.

For example:

Existing Plan
Valid From: 2026-01-01

New Plan
Valid From: 2026-10-01

The newer plan can then take precedence for transactions from October 1 onward.

The Commission Ledger preserves calculations that were already created under the previous configuration.

Adding Rules¶

After creating the plan, create the Commission Rules that define the actual commission conditions and calculations.

For example:

Standard Sales Commission
│
├── Smartphone Commission → 5%
├── Laptop Commission     → 7%
└── Enterprise Customers  → 10%

The plan provides the configuration context.

The rules determine when and how commission is calculated.

See Rules for detailed rule configuration.

Example: Complete Plan Setup¶

Suppose a company wants to introduce a standard sales commission beginning October 1.

Create:

Plan Name: Standard Sales Commission
Company:    Your Company
Currency:   INR
Valid From: 2026-10-01
Valid To:   —
Status:     Active

Then create the associated Commission Rules.

For example:

Standard Sales Commission
        │
        ├── Smartphone → 5%
        ├── Laptop → 7%
        └── Enterprise Customer → 10%

The plan and rules together provide the configuration used when eligible Sales Invoices are processed.

Changing Plan Configuration¶

Plan configuration can change over time.

When making a change that should affect future transactions, consider whether the change represents a new commission period or configuration.

For a clear configuration transition, use a new Commission Plan with a new Valid From date.

Do not expect changing current configuration to rewrite historical Commission Ledger entries.

Historical ledger entries preserve the commission configuration and calculation values that were recorded when the commission was created.

Troubleshooting¶

The Plan Is Not Being Selected¶

Check:

The plan status is Active.
The Company matches the Sales Invoice company.
The transaction date falls within the plan's validity period.
Another active plan with a more recent Valid From date is not taking precedence.

A Rule Is Not Being Evaluated¶

First confirm that the correct Commission Plan is being selected.

Then check the Commission Rule configuration, including:

Commission Plan
Rule Applies To
matching condition
Priority
Calculation Method
Enabled status

See Rules for the rule configuration process.

Best Practices¶

Use One Clear Purpose Per Plan¶

Name plans according to their business purpose and validity period.

Define Effective Dates Carefully¶

Use Valid From and Valid To to make plan changes explicit.

Keep Historical Configuration Traceable¶

Use new plans for meaningful configuration changes rather than trying to reinterpret historical commission calculations.

Activate Only Ready Plans¶

Keep plans in Draft while configuring them and change them to Active when they are ready to participate in commission processing.

Next Step¶

Once the Commission Plan is configured, create the rules that determine which transactions generate commission and how that commission is calculated.

Continue with Rules.