difference between bonus and commission
Thus, it is every employerâs responsibility to know the difference between commission and bonus. Basically, commission is calculated based on the sales of an employee. For certain workers who are exempt from traditional wage and hour requirements, their salary may be solely based on an agreed upon percentage of their sale.
Whether your employer pays you a bonus for meeting certain goals or offers a commission for each client you bring in the door or for every sale you make, both types of compensation are taxable. Bonuses and commissions are treated differently from the regular salary you earn and are referred to as supplemental wages..