A professional partnership with three members disposes of all the shares of the services corporation ("Serviceco" - rendering services to the partners and their clients) to a corporation ("Opco") owned by one of the partners for $600,000 and realizes a capital gain of $600,000. Serviceco would then be wound-up into Opco, and Opco would ultimately pay the $600,000 sale price.
CRA indicated that s. 84.1 would apply if the sale was a non-arm’s length transaction, which would be the case if Opco was an accommodation party.