Do you know about the Tax Implications of Equipment in Commercial Real Estate?

Written by: François Duquette & Chris Karambatsos

In Québec, it is not always easy to predict what will be included in the municipal tax assessment of a commercial property in order to properly budget for its tax bill. The assessment focuses on immovables, but what exactly is meant by “immovable”?

In practice, commercial equipment is often considered immovable, and its value will be included in the tax assessment of the property. It is important to note that the equipment does not need to be physically attached to the building to be considered, but the mere fact that the equipment is essential to the building’s use may be sufficient.

It is also worth noting that there are exemptions to consider when discussing inclusions of immovables in tax assessments, so staying informed is key. The presence of equipment in commercial buildings can directly affect the payable property tax and, potentially, the mutation tax on transaction.

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