How does OTA commission work for independent hotels?
Last reviewed 2026-07-02
An OTA charges commission as a percentage of the reservation, deducted from what it remits to you or invoiced back to you. The rate is set in your agreement, but what it applies to, room revenue only or the full charge including taxes and fees, and whether it survives a cancellation, is where properties lose money they do not notice.
- Commission is a percentage of the reservation set in your OTA agreement.
- It should apply to room revenue, not taxes and fees.
- Cancelled and no-show stays should not carry commission.
- The rate and its base are exactly where overcharges creep in.
How the charge is calculated
The OTA applies your contracted percentage to the reservation and either nets it out of what it pays you or bills it back. Different channels and rate plans can carry different percentages, so a single property often has several commission rates in play at once.
What it should and should not cover
Commission should be taken on room revenue at your agreed rate, not on taxes, resort fees, or other pass-through charges, and not on stays that cancelled or no-showed. When it is, the charge is above what your agreement allows.
Why it drifts
Statements are high in volume and span multiple channels and rate plans. Without someone matching each charge to the agreement and the reservation, an inflated rate or a commission on the wrong base passes through unnoticed.
Common questions
Is commission charged on the room only?
It should be, at your agreed rate. Commission taken on taxes and fees, not just room revenue, is a common and disputable overcharge.
Do I owe commission on a cancelled booking?
Generally no. Commission on stays that cancelled or no-showed is one of the most frequent errors to catch.
Why do I have more than one commission rate?
Different channels and rate plans carry different percentages. That mix is exactly why per-reservation matching catches errors a single-rate assumption would miss.
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