Private ruling: Cost base of shares after non-scrip capital contribution
Date of advice: 4 June 2019
Published: August 2019

Ruling: Q1: Will section 110-25 of the Income Tax Assessment Act 1997 apply to the amounts contributed by the taxpayer company to subsidiary company, by way of non-scrip capital contributions, such that the amounts contributed, will be included in the cost base of the ordinary shares held? | A1: Yes

Relevant facts and circumstances: A taxpayer company applied for a ruling in respect of the application of section 110-25 of the Income Tax Assessment Act 1997 . The taxpayer company owns 100% of the issued capital in an offshore subsidiary company. The taxpayer company will contribute funds to the subsidiary by way of non-scrip share capital contributions.