What is turnover rent?

Turnover rent — also called percentage rent — is rent calculated as a percentage of a tenant's gross sales above an agreed threshold, paid in addition to a fixed base rent. It is standard in UAE shopping-mall leases and makes the tenant's sales figures a contractual reporting obligation.

How it works

The rent has two parts. The base rent is fixed and payable regardless of trade. The turnover rent is a percentage of gross turnover above a threshold called the breakpoint. Below the breakpoint you pay only base rent; above it you pay base rent plus the percentage on the excess.

Where the breakpoint is natural, it equals base rent divided by the percentage — AED 600,000 of base rent at 8% gives a breakpoint of AED 7.5 million. Where it is a negotiated fixed figure it can sit well below that, so turnover rent starts earlier at the same headline percentage.

Why the definition matters more than the percentage

Your lease defines "gross turnover" in its own words, and that definition decides whether VAT, refunds, staff-discounted sales, gift-card redemptions, delivery-aggregator orders at gross order value and e-commerce fulfilled from the unit are inside the figure you declare. On a food unit with heavy delivery volume, that wording can move declared turnover by a fifth — considerably more than a point of negotiation on the rate.

What it obliges you to do

Leases with turnover rent require periodic sales statements, usually monthly or quarterly, and an annual turnover certificate — which most institutional landlords require from a registered auditor. Landlords typically hold audit rights, and where an audit finds under-declaration the lease commonly makes the tenant pay the shortfall, interest and the cost of the audit.

Reviewed 18 August 2026 by Ahmed Nabil Selim. UAE tax rates, thresholds and deadlines change — confirm the position for your period before relying on it.