14 March 2016 External T.I. 2016-0626781E5 - Neuman Type Situation -- summary under Subsection 73(1)

In the scenario where a company owned by Mr. A ssues a share to Mrs. A for nominal consideration, and then pays a substantial dividend to Mrs. A, CRA indicated that if Kieboom applied, "Mr. A would be considered to have disposed of a… right to dividends in Opco to Mrs. A.” However, as the s. 73(1) rollover would apply, this disposition by Mr. A would be at cost.