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The Percentage Lease

The last of five leases defined this week

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This lease lets the landlord benefit from your success. The rent is based on either a minimum or base amount, or a percentage of your business's gross revenue, whichever is higher. Percentages typically range from 3 to 12 percent. With this type of lease, you'll be required to periodically furnish proof of gross sales; to do this, you may allow the landlord to examine your books or sales tax records, or provide a copy of the appropriate section of your tax return. Percentage leases are common for retail space.

Excerpted from Start Your Own Business: The Only Start-Up Guide You'll Ever Need