What is trail commission in mutual funds?

Trail commission is the ongoing commission a mutual fund distributor or agent earns as long as the investor stays invested. It is usually a percentage of the investor’s AUM and is often paid monthly or quarterly.

How is trail commission calculated?

A simple estimate is: yearly trail commission equals average AUM multiplied by the trail rate. Monthly trail commission is the yearly amount divided by 12. Actual payouts can differ by AMC, scheme category, TER changes and other rules.

Why does this calculator show year-wise trail commission rates?

Many payout structures define different trail rates by year buckets such as Year 1, Year 2, Year 3 and Year 4 onwards. This helps estimate long term ongoing commission as investor tenure increases.

Is this calculator exact?

No. This is an estimate. Actual trail payouts can be calculated using daily average assets and can vary by AMC policies, scheme rules and clawbacks.

Is mutual fund agent commission the same as distributor commission?

Yes. Mutual fund agent commission and mutual fund distributor commission refer to the same earnings. SEBI and AMFI use the formal term distributor, but in everyday usage agent and MFD mean the same person.

Free tool for Indian MFDs

Mutual Fund Distributor Commission Calculator

Estimate year-wise trail commission earnings on SIP, lump sum, or existing AUM. Built for working MFDs and agents in India.

SIP amount per month (₹)

Monthly SIP amount. This calculator simulates month-by-month growth.

Duration (years)

1 to 30 years

Expected return (% p.a.)

Used only for projection

New B30 or new woman investor 2026 incentive

SEBI regime from 1 March 2026: a one-time 1% of the first-year investment, capped at ₹2,000 per new PAN, for a first-time investor from a B30 city or a first-time woman investor (T30 or B30). Paid about a year after the first investment. Applies to new money only, not existing AUM.

Disclaimer: This is an estimate. Actual ongoing commission can vary by AMC, scheme rules, TER changes and clawbacks. For the full structure breakdown including B30 incentives, GST, TDS and settlement timelines, read our guide to mutual fund distributor commission in India.

Trail Commission Rates (Ongoing)

Ongoing commission paid on AUM. Some payout structures use different rates for Year 1, Year 2, Year 3 and Year 4 onwards. See typical category-wise commission ranges before adjusting these defaults.

Year 1 (%)

Year 2 (%)

Year 3 (%)

Year 4+ (%)

Total trail across all years₹1,27,688

Last year (per year)₹27,983

Last year (per month avg)₹2,332

You could earn ₹1,27,688 in trail commissions over 10 years.

Send yourself the year-by-year breakdown, and keep it for when you compare against what the AMCs actually pay you.

Year-wise Trail Commission Schedule

Avg AUM = (Start AUM + End AUM) / 2 per year.

Year	Start AUM	Contribution	End AUM	Trail rate	Commission (Year)	Commission (Mo. avg)
1	₹0	₹2,40,000	₹2,52,811	0.75%	₹948	₹79
2	₹2,52,811	₹2,40,000	₹5,30,903	0.75%	₹2,939	₹245
3	₹5,30,903	₹2,40,000	₹8,36,804	0.75%	₹5,129	₹427
4	₹8,36,804	₹2,40,000	₹11,73,295	0.75%	₹7,538	₹628
5	₹11,73,295	₹2,40,000	₹15,43,435	0.75%	₹10,188	₹849
6	₹15,43,435	₹2,40,000	₹19,50,589	0.75%	₹13,103	₹1,092
7	₹19,50,589	₹2,40,000	₹23,98,459	0.75%	₹16,309	₹1,359
8	₹23,98,459	₹2,40,000	₹28,91,115	0.75%	₹19,836	₹1,653
9	₹28,91,115	₹2,40,000	₹34,33,038	0.75%	₹23,716	₹1,976
10	₹34,33,038	₹2,40,000	₹40,29,152	0.75%	₹27,983	₹2,332

Note: This is for planning and education. Exact payouts may differ by AMC and scheme.

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SIP agent commission

How SIP agent commission is calculated

A SIP agent earns trail commission on the balance the SIP builds up, so the payout starts small and grows every year as instalments accumulate. In the first year the AMC pays trail on a balance that is still filling, which is why year one looks modest next to the later years.

Take the default case in the calculator above: a ₹20,000 monthly SIP held for 10 years, a 10% annual return and a 0.75% trail rate. Year one pays about ₹948, because the average balance that year is only around ₹1.26 lakh. By year 10 the corpus has reached about ₹40.3 lakh, and the same SIP pays roughly ₹27,983 for the year, or ₹2,332 a month. Over the full 10 years, trail on this one SIP adds up to about ₹1.28 lakh.

If the investor is new to mutual funds and is either from a B30 city or a first-time woman investor, the regime effective 1 March 2026 adds a one-time incentive of 1% of the first year’s SIP amount, capped at ₹2,000 per PAN. Tick the new-investor option above to include it in your estimate.

To model your own book, switch to SIP mode, enter the monthly amount and holding period, and replace the default trail rate with the rate your AMC partner portal shows for that scheme.

FAQ

Frequently asked questions

It is the ongoing commission a distributor or agent earns as long as the investor stays invested. Usually a percentage of AUM, paid monthly or quarterly by the AMC. Our guide covers what trail commission in mutual funds is and how AMCs pay it.

Some payout structures use different rates in Year 1, Year 2, Year 3, and Year 4 onwards. The defaults in this calculator reflect a typical equity scheme. Adjust for your AMC mix.

No. This is an estimate for planning. Actual payouts vary by AMC, scheme rules, TER changes, and clawbacks. Read our explainer on clawback triggers and how they affect payouts to understand why projections and actual credits often differ. For exact tracking against real AMC payouts, you would want a proper distributor platform.

Yes. SEBI and AMFI use the formal term distributor, but agent and MFD are used interchangeably in everyday conversation. The role, the earnings and the registration process are identical.

Most of a SIP agent’s income is trail commission, paid each year as a percentage of the value the SIP has built up. At a 0.75% trail rate, a ₹20,000 monthly SIP earns about ₹948 in its first year and about ₹27,983 in its tenth year as the corpus grows. Rates differ by scheme and AMC, so enter your actual rate above.

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