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Real Estate Commission Splits in Canada: What You Actually Take Home

Brokerage splits, franchise fees, desk fees, and HST all reduce your take-home commission. Here's how to calculate your net pay on any transaction.

Real Estate Commission Splits in Canada: What You Actually Take Home

The commission rate on a sale is just the starting point. By the time a Canadian real estate agent's commission passes through the brokerage, the franchise, HST, and expenses, the take-home is significantly smaller. Understanding each layer helps you evaluate brokerage offers and negotiate your split.

The Deduction Layers

1. Brokerage Split

Your agreement with your brokerage determines what percentage of each commission you retain. Common models:

  • Traditional split: 50/50 or 60/40 (agent keeps the smaller share), typically for new agents
  • Progressive split: Increases as you hit production milestones (70/30 at $1M GCI, 80/20 at $2M, etc.)
  • Capped model: 70/30 until you've paid a "cap" amount (e.g., $18,000) to the brokerage that year, then 100% for the rest of the year
  • 100% model: Agent pays a flat desk fee and keeps all commission — no split. Better for high-volume agents

2. Franchise/Brand Fee

Branded brokerages (RE/MAX, Century 21, Royal LePage, Keller Williams, etc.) charge a franchise fee on each transaction, typically 5–8% of GCI, in addition to the brokerage split. This is negotiated between the franchise and each individual brokerage — ask before signing.

3. Desk and Admin Fees

Monthly fixed costs that vary widely:

  • National brands: $0–$2,000/month
  • Boutique/independent: $200–$800/month
  • 100% commission offices: $500–$2,000/month + per-transaction fee

4. E&O Insurance

Errors and Omissions insurance is mandatory in most provinces. Typically $800–$1,500/year depending on coverage level.

5. HST (Agent's Perspective)

Agents earning >$30,000 GCI must charge HST on their commission income. The brokerage handles the HST collection on buyer/seller commissions, then pays the agent their share. Agents may owe or receive input tax credits depending on their business expenses.

Evaluating a Split Offer

Don't compare splits in isolation — compare effective take-home per transaction across models at your projected production level.

An 80/20 split at a brokerage with strong leads and admin support may yield more net income than 100% at an office where you pay for everything.

Try the Calculator

→ Commission Split Calculator

Official Resources