Section 79
Section 79: special provision for full value of consideration for transfer of share other than quoted share
Section 79 targets under-valued sales of unquoted (unlisted or not regularly traded) shares. If a company's shares - other than a "quoted share" - are sold for less than their prescribed fair market value, that fair market value is treated as the sale consideration for capital gains purposes instead of the actual price.
The core rule
Section 79(1) deems the fair market value of a share (determined in the prescribed manner) to be the full value of consideration for Section 72, where the actual consideration received or accruing from transfer of that share is less than its fair market value - and the share is not a "quoted share."
Exceptions
Section 79(2) provides that this rule does not apply to consideration received from transfers by prescribed classes of persons, or subject to prescribed conditions.
What counts as a "quoted share"
Section 79(3) defines "quoted share" as a share quoted on a recognised stock exchange with regularity, where the quotation is based on actual transactions made in the ordinary course of business.
Frequently asked questions
Does Section 79 apply to shares listed on a stock exchange?
No - it specifically excludes "quoted shares," meaning shares regularly quoted on a recognised stock exchange based on genuine ordinary-course transactions, per Section 79(3).
What happens if I sell unquoted shares below fair market value?
The fair market value, determined in the prescribed manner, is deemed to be the full value of consideration for capital gains purposes under Section 79(1), unless an exception under Section 79(2) applies.
Related sections
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Get expert help on unquoted share transfer valuationLast updated 9 September 2026