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ARTICLE · 06 MARCH 2026

Mixed-Use, Mixed Signals: Why Purchase Price Allocations Matter

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As the saying goes, there are only two certainties in life—death and taxes. Unless, as in the case of Miculinic Investment Corp. v. 2303515 Ontario Inc., et al., you're dealing with the amount of tax...

CanadaReal Estate and Construction
Simon Crawford
Simon Crawford
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As the saying goes, there are only two certainties in life—death and taxes. Unless, as in the case of Miculinic Investment Corp. v. 2303515 Ontario Inc., et al., you're dealing with the amount of tax owing on a purchase of mixed-use property without a clear purchase price allocation between the residential and commercial portions. In this case, there most definitely was uncertainty.

Background and Transaction Overview

On August 4, 2021, Miculinic Investment Corp. (the Vendor) entered into an agreement of purchase and sale (the APS) with 2303515 Ontario Inc. and 1000029174 Ontario Inc. (the Purchaser), to sell a mixed residential and commercial use property for C$11,500,000. The APS contained a standard form fill in the blank provision that stated that harmonized sales tax (HST) was "included in" the purchase price. The APS did not set out the amount of HST owing, or what portion of the property was residential versus commercial (which, in this case, had an

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