What is the cost (and amount incurred as an expense) for intellectual property with an unlimited life acquired by a corporation resident in Canada as a result of a return of capital from a wholly-owned foreign affiliate. Before concluding that for purposes of applying the eligible capital expenditure definition to the Canadian shareholder, the expenditure incurred by it would be considered to be equal to the FMV of the property at the time of its distribution, CRA stated:
[T]he cost of a property received by a corporation from its shareholder for no consideration, for example as a capital contribution, would…result in the corporation having a cost of the property equal to its FMV.