If you own an apartment or villa in a Dubai community, you have seen the invoice: a yearly bill for “service charges” that can run into thousands of dirhams, separate from your mortgage and utilities. Tenants see it too, sometimes passed through in the lease. Understanding property service charges is essential because these fees pay for everything that keeps a building running — lifts, security, cleaning, landscaping, the gym, the pool and the long-term repair fund — and in Dubai they are legally enforced.
This guide breaks down what service charges are, who actually pays them, how the amounts are calculated, where to check the approved rates for your building, and what happens if they are not paid. The focus is Dubai, where the system is the most developed, with notes for Abu Dhabi where the rules differ slightly.
Quick Answer
Property service charges are annual fees paid by the owner of each unit in a jointly owned development to cover the running costs of common areas and shared facilities, plus a contribution to a reserve fund for major future repairs. In Dubai they are budgeted by the building’s management company, approved by RERA through the Mollak system, and apportioned to units — usually by floor area. The owner registered on the title deed is legally responsible for paying them, even if a tenancy contract asks the tenant to reimburse the cost. You can verify the approved rate per square foot for any project on the Dubai Land Department’s Service Charge Index.
Understanding Property Service Charges: What They Actually Cover
Think of a residential tower as a small town. The lifts, lobbies, corridors, stairwells, parking decks, gyms, pools, gardens, security desks, CCTV systems and fire-safety equipment all belong to everyone jointly — and all of it costs money to run. Service charges are each owner’s share of those costs. A typical budget includes:
- Building management and administration: the management company’s fees, owners’ association costs, accounting and audits.
- Security and concierge: guards, reception staff, access-control systems and CCTV monitoring.
- Cleaning and landscaping: common-area cleaning, waste collection, gardeners and pool maintenance.
- Utilities for common areas: electricity and water for lobbies, corridors, parking and landscaped areas.
- Lifts and mechanical systems: maintenance contracts for lifts, pumps, generators, fire alarms and sprinklers.
- Building insurance: the master policy covering the structure and common areas (separate from your own home contents insurance, which covers your belongings inside the unit).
- Reserve (sinking) fund: money set aside for big future jobs — facade repairs, lift replacement, waterproofing — so owners are not hit with a sudden special levy.
What service charges do not cover is your own unit: your electricity bill, your internet, and repairs inside your apartment are yours. Minor wear inside the flat is a tenant or owner expense depending on the lease, as explained in our complete property maintenance guide.
How Service Charges Are Calculated
The calculation is simpler than it looks. Each year, the management company prepares a budget for the development: the expected cost of every item above, plus the reserve fund contribution. That budget goes through Mollak, the DLD system for jointly owned properties, where RERA reviews and approves it before a single dirham can be billed. Once approved, the total is split among the units, normally in proportion to each unit’s share of the common area — in practice, by floor area.
So the formula is roughly: your annual service charge = approved rate per sq ft × your unit’s chargeable area. Approved rates vary enormously. A basic mid-rise apartment block might be approved at AED 8–12 per sq ft per year, while a luxury tower with extensive facilities can be AED 20–30 or more per sq ft. A 1,000 sq ft apartment at AED 15 per sq ft costs AED 15,000 a year — which is why buyers should always check the rate before purchasing, not after.
For a deeper look at the legal framework and the Mollak process, see our companion piece, Property Service Charges Explained.
Who Pays: Owner or Tenant?
This is the question that causes most arguments. The legal position in Dubai is clear: the owner named on the title deed is responsible for service charges. The management company bills the owner, and if the bill is not paid, it is the owner’s unit that faces enforcement action — not the tenant’s.
That said, many tenancy contracts include a clause passing some or all of these costs to the tenant, either folded into the rent or billed separately. Whether that is enforceable between landlord and tenant is a matter of the contract, but it does not change the owner’s obligation to the management entity. If you are a tenant, read the lease before signing: look for any mention of “service charges,” “building fees” or “community fees.” If the lease is silent, the landlord cannot normally bill you for them afterwards — but always confirm who pays for what in writing before you sign.
Renters comparing total housing costs should factor any passed-through charges into the maths — our guide to how to calculate basic rental costs shows how extras like these push the real monthly figure above the headline rent.
How to Check the Approved Rate for Your Building
You do not have to take an invoice at face value. RERA publishes approved rates on the Service Charge Index, available through the Dubai Land Department’s e-services and the Dubai REST app. The Dubai Land Department’s how-do-I pages explain how to look up the index by project name, usage and year. Compare the rate on your invoice against the approved figure:
- If they match, the charge is legitimate — pay it on time.
- If the invoice is higher than the approved rate, raise it first with the management company, then with DLD if it is not resolved.
- If services are poor relative to what you are paying — dirty corridors, broken lifts, an unusable gym — you can file a complaint through DLD’s Real Estate Violations System in the Dubai REST app.
Owners should also log into the Mollak portal, where invoice-level detail and payment history live. Keep every invoice and receipt; service charge records are part of the paperwork any buyer will ask for when you sell, alongside the documents in our Dubai property transfer process guide.
What Happens If Service Charges Are Not Paid
Unpaid service charges are not a bill you can quietly ignore. The consequences escalate:
- Reminders and late fees. The management company will chase payment and may add penalties set out in the community rules.
- Formal notice. A RERA-endorsed written notice typically gives the owner 30 days to settle.
- Enforcement. The claim can be taken to the Rental Disputes Settlement Centre, and the management entity holds a statutory lien over the unit. In extreme cases a property can be sold at public auction to recover arrears.
- Blocked transactions. DLD will not allow a sale or transfer of the unit until all service charge arrears are cleared — so unpaid charges follow you to the closing table.
Charges apply whether the unit is occupied or empty; there is no discount for a vacant property, because the common areas still need running. Foreign owners should note this before buying and leaving a unit sitting idle — see our guide to property ownership for foreigners in Dubai for the wider picture.
Service Charges in Abu Dhabi and Other Emirates
Abu Dhabi has its own framework for jointly owned properties, administered through the Department of Municipalities and Transport, and owners’ associations there operate under different regulations than Dubai’s Mollak system. The underlying idea is identical — owners share common-area costs — but the approval process, invoicing and dispute routes differ. Sharjah and the northern emirates have smaller-scale arrangements, often managed directly by developers. If you own outside Dubai, check the rules of the specific emirate rather than assuming the Dubai process applies.
Tips for Keeping Service Charges Under Control
- Check the rate before you buy. A low purchase price with punishing service charges is a bad deal. Ask for the current RERA-approved rate per sq ft and the last two years of budgets.
- Attend owners’ association meetings. Owners vote on budgets and can challenge line items. Absentee owners effectively hand the pen to the management company.
- Scrutinise the reserve fund. A healthy reserve means fewer special levies later. Ask what percentage of the budget it represents and what major works are planned.
- Compare with similar buildings. If your tower charges far more per sq ft than a comparable one nearby, ask why — the Service Charge Index makes the comparison easy.
- Pay on time and keep records. Late payment triggers penalties and blocks future sales. Filed invoices also protect you if a future buyer or tenant asks questions.
- Separate building insurance from contents cover. The master policy does not protect your furniture or personal belongings — that is what your own property insurance is for.
Frequently Asked Questions (FAQs)
Are service charges included in the rent?
Sometimes, but not by default. Many landlords factor them into the rent they ask; others add a clause requiring the tenant to reimburse them. Ask directly before signing and get the answer in the contract, because “service charges” appearing on an invoice months later is one of the most common rental surprises.
How much are service charges in Dubai per square foot?
There is no single figure — it depends on the building’s facilities, age and management. Basic residential blocks are often approved in the low teens per sq ft per year, while high-end towers with pools, gyms and concierge services can be two or three times that. Always check the RERA-approved rate for the specific project on the Service Charge Index rather than relying on averages.
Do I pay service charges if my property is vacant?
Yes. Service charges apply to every unit in a jointly owned development regardless of occupancy, because common areas, security and insurance continue whether anyone is home or not. RERA does not grant exemptions for vacant units.
Can the management company increase service charges?
Only through the proper process: a new annual budget submitted via Mollak and approved by RERA. The management company cannot simply raise the rate on its own authority. If your invoice jumps, check whether a new approved budget backs it up.
What should I do if the services are poor but the charges are high?
First confirm the invoiced amount matches the RERA-approved rate. If the amount is correct but the service is bad — lifts out of action, dirty common areas — document the problems with photos and dates, raise them in writing with the management company, and escalate to DLD’s Real Estate Violations System in the Dubai REST app if nothing changes.
Do tenants in Abu Dhabi pay service charges?
As in Dubai, the legal obligation sits with the owner, though a tenancy contract may pass costs to the tenant by agreement. Abu Dhabi’s owners’ association framework differs from Dubai’s, so check the specific community rules and your lease wording.
The Bottom Line
Property service charges are the shared cost of keeping a building liveable — security, cleaning, lifts, facilities and the reserve fund that prevents nasty surprises down the road. In Dubai they are budgeted, RERA-approved and legally enforceable against the owner, so check the approved rate before you buy, read the lease carefully before you rent, pay on time, and keep your invoices. A few minutes on the Service Charge Index today can save you thousands of dirhams of confusion later.
Last Updated: 8 October 2026
About the author: Zaviyar Sultan is a UAE-focused writer at Asandada24, covering driving, visas, banking, insurance and everyday UAE life. His guides are researched from official UAE government and regulator sources and updated regularly.
Asandada24 is an independent informational website, not affiliated with the UAE government or any agency mentioned; content is general information only, not legal, immigration or financial advice; verify critical details with official sources before acting.