CRA accepts a post-closing receipt by Buyco, to reduce the share purchase price, as a reduction in its share cost

Where, following a sale of Opco by Sellco to Buyco, CRA reassesses Opco to increase its income for a pre-closing taxation year, the resulting tax liability of Opco will reduce the safe income on hand attributable to the Opco shares of Buyco.  This will be the case irrespective of whether there is a price adjustment clause to the selling price which requires Sellco to make a corresponding payment to Buyco – although in such event there will be a reduction to the cost of the Opco shares to Buyco.

Neal Armstrong.  Summary of 11 October 2013 APFF Round Table, Q. 18, 2013-0495851C6 F under s. 55(2).