A Complete Guide to Rental Fees and Taxes in Dubai

Are you new to Dubai or someone relocating within the city and want to rent an apartment or home? Well, it is necessary to know about the rental charges and taxes to avoid unexpected or extra costs. In Dubai, the process of renting a house or property is simple, however, there are several charges and taxes that most tenants don’t know. 

To make your stay more stress-free here, this blog guides you through all the major fees, taxes, and legal requirements for renting property in Dubai. Let’s explore everything in detail!

Your rental journey in Dubai starts with understanding the basic rent amount. This is usually quoted annually and paid in advance through 1 to 4 post-dated cheques, though some landlords may accept monthly payments.

The rent typically covers:

• Use of the property
• General building maintenance (covered by the landlord)
• Standard amenities like parking (if included in the contract)

1. Ejari Registration Fee

Dubai requires all rental agreements to be registered with Ejari, the official rental registration system under the Dubai Land Department (DLD).

• Fee: AED 220 (paid by the tenant)
• Why it matters: It legalizes your lease, protects your rights, and is needed for setting up DEWA utilities, sponsoring dependents, or filing rental disputes.

2. Real Estate Agent Commission

If you use a property agent to find a rental home, expect to pay a commission fee.

• Standard rate: 5% of the annual rent
• Who pays: Usually the tenant, unless agreed otherwise
• Note: Always work with RERA-certified agents to avoid scams.

Looking for a rental without the hassle? Jaxtox Real Estate lists verified properties across Dubai, helping you find the right home while working with trusted, RERA-certified agents. Contact them now.

3. Security Deposit

Landlords in Dubai require a refundable security deposit, which is returned at the end of the lease, minus any repair or cleaning costs.

• Unfurnished units: 5% of annual rent
• Furnished units: 10% of annual rent
• Refund timeline: Usually within 14 to 30 days after moving out

4. DEWA and Housing Fees

Once your contract is registered, you’ll need to set up utilities via the Dubai Electricity and Water Authority (DEWA). This fee is mandatory for all tenants in Dubai and contributes to local services like waste collection and infrastructure maintenance. The DEWA deposit fee is AED 2,000 for an apartment and AED 4,000 for a villa. This fee is refundable. You may also be asked to deposit a connection fee of AED 130 for once. Further, the tenants are also required to submit the Municipality Housing Fee of 5% of their annual rental charges.

5. Chiller or Cooling Charges

In some residential buildings such as, Dubai Marina, Downtown, or Business Bay, you will pay extra charges if the air conditioning is provided by district cooling companies. The air conditioning fee is usually billed separately, but can also be included in your rent. Depending on the unit size and usage, the monthly cost for a chiller may range from AED 300 to AED 800.

6. VAT on Commercial Rentals

If you’re renting commercial space (like a shop or office), the lease will include 5% VAT as per UAE law. This tax applies to all non-residential leasing contracts. However, there will be no VAT on residential tenants.

7. Maintenance and Service Charges

Routine building maintenance is generally the landlord’s responsibility. However, tenants may be asked to cover minor repair costs (usually below AED 500). These are often mentioned in the lease agreement. It is recommended to check these charges before you sign your rental papers. If your community is giving you extra amenities such as a clubhouse, gym, private park, or shuttle bus, you will also pay for that.

8. Moving-In and NOC Fees

Certain buildings or communities (especially those managed by developers like Emaar or Nakheel) may charge a moving-in fee or require a No Objection Certificate (NOC) before allowing tenants to move in. You will generally need a copy of your Ejari and passport to get this NOC from the building management. The charges for NOC or move-in fee is paid by the tenant and it varies across different communities. This fee ranges from AED 500 to AED 1,000.

9. Early Termination Penalty

There can be penalty charges if a tenant break the lease rules before the agreed period. The standard penalty in this case is that the tenant has to pay 1 to 2 months’ rent if he or she leaves before the due time. However, the penalty is still negotiable in some cases. For example, the charges can be waived off in case of an emergency or a sudden job loss.

10. Subleasing Rules

Generally, subleasing any property is not allowed in the Dubai rental market. However, in the case of Ejari, you have to get written approval from the landlord. The tenants should ensure that they have written permission from their landlord. An unauthorized subleasing of the property can lead to eviction. Also, it can put the landlord at risk of heavy fines from the concerned authorities in Dubai.

Frequently Asked Questions

Is rent in Dubai paid monthly or yearly?

It depends on the area and your landlord. Generally, most of the landlords prefer annual rent paid in 1 to 4 cheques. However, some of them can charge you on a monthly basis.

Do tenants pay tax in Dubai?

There is no direct tax on the rental income in Dubai. However, the tenants are directed to pay the municipality fee (5% of the annual rent) through their DEWA bills.

Can a landlord increase rent every year in Dubai?

Yes, they can. However, there is a limit set to it by the RERA Rent Index. Also, the landlord is required to notify the tenants 90 days beforehand.

Is VAT applied to residential renters in Dubai?

No. There is no VAT applied to residential renters in Dubai. 

Final Words

Renting a home in Dubai is simple, but knowing the fees helps you avoid surprises. From Ejari to DEWA and agent costs, being aware saves time and money. Always read your contract carefully and ask questions if anything is unclear. For any kind of information about rental charges or taxes of a specific locality or development in Dubai, contact Jaxtox now. Our property advisers will guide you regarding everything so that you can enjoy your stay without worrying about penalties or disputes.