|Investment tax credit|
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Definition of Investment tax credit
Investment tax credit
Proportion of new capital investment that can be used to reduce a company's tax bill
Investment Tax Credit
A reduction in taxes offered to firms to induce them to increase investment spending.
The net present value analysis of an asset if financed solely by equity
Provides additional financial security should an insured person be dismembered or lose the use of a limb as the result of an accident.
The ratio of net income to net sales.
Money after-tax rate of return minus the inflation rate.
Refers to the reduction of debt by regular payments of interest and principal in order to pay off a loan by maturity.
A situation wherein participants in a transaction have different net tax rates.
taxes as a fraction of income; total taxes divided by total taxable income.
Total taxes owed divided by total income.
The ratio of net income before taxes to net sales.
The person or party designated to receive proceeds entitled by a benefit. Payment of a benefit is triggered by an event. In the case of credit insurance, the beneficiary will always be the creditor.
The requirement that a claim holder voting against a plan of reorganization
A consumer who borrows money from a lender.
The tax rate at which a party to a prospective transaction is indifferent between entering
The use of capital to create more money through the addition of fixed assets or through income producing vehicles.
Refers to various techniques and procedures
Money used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses.
Cash flow after interest and taxes
Net income plus depreciation.
Commercial Business Loan (Credit Insurance)
An agreement between a creditor and a borrower, where the creditor has loaned an amount to the borrower for business purposes.
Comparative credit analysis
A method of analysis in which a firm is compared to others that have a desired
credit granted by a firm to consumers for the purchase of goods or services. Also called
Consumer Credit Protection Act
A federal Act specifying the proportion of
Corporate tax view
The argument that double (corporate and individual) taxation of equity returns makes
Corporate taxable equivalent
Rate of return required on a par bond to produce the same after-tax yield to
Buying or selling goods or services now with the intention of payment following at some time in
One side of a journal entry, usually depicted as the right side.
A rating of a company's credit (ability to payback debt), usually by a third party credit agency.
On your bank statement, 'credit' represents funds that you have deposited into your account. The opposite of a credit is a debit.
The process of analyzing information on companies and bond issues in order to estimate the
Procedure to determine the likelihood a customer will pay its bills.
An organization that provides financial institutions with credit information concerning existing or potential customers who are looking to obtain credit services.
A revolving source of credit with a pre-established limit. You have to pay interest on a credit card if you have an outstanding balance.
A decline in the ability or willingness of banks to lend.
Purchase of the financial guarantee of a large insurance company to raise funds.
A loan receivable that has proven uncollectible and is written off.
A record of the funds which have been credited to your account.
The length of time for which the customer is granted credit.
Standards set to determine the amount and nature of credit to extend to customers.
Restriction of loans by lenders so that not all borrowers willing to pay the current interest rate are able to obtain loans.
The risk that an issuer of debt securities or a borrower may default on his obligations, or that the
Financial and moral risk that an obligation will not be paid and a loss will result.
A statistical technique wherein several financial characteristics are combined to form a single
Conditions under which credit is extended by a lender to a borrower.
credit unions are community based financial co-operatives and most offer a full range of services. All are owned and controlled by members who are also shareholders. credit unions are regulated provincially and insured by a stabilization fund, deposit insurance or guarantee corporation.
The interest rate offered on an investment type insurance policy.
Lender of money.
Person or business that is owed money.
Creditor (Credit Insurance)
A lender or lending institution that offers financing and loans to a borrower, for the purpose of acquiring a commodity.
Creditor Proof Protection
The creditor proof status of such things as life insurance, non-registered life insurance investments, life insurance RRSPs and life insurance RRIFs make these attractive products for high net worth individuals, professionals and business owners who may have creditor concerns. Under most circumstances the creditor proof rules of the different provincial insurance acts take priority over the federal bankruptcy rules.
Purchases of goods or services from suppliers on credit to whom the debt is not yet paid. Or a
Critical Illness Insurance (Credit Insurance)
Coverage that provides a lump-sum payment should you become seriously ill with a specified illness. The payment is made to your creditors to pay off your debt owing.
Current Income Tax Expense
That portion of the total income tax provision that is based on
Current Tax Payment Act of 1943
A federal Act requiring employers to withhold income taxes from employee pay.
Debt (Credit Insurance)
Money, goods or services that someone is obligated to pay someone else in accordance with an expressed or implied agreement. Debt may or may not be secured.
Deferred Income Tax Expense
That portion of the total income tax provision that is the result
Deferred Tax Asset
Future tax benefit that results from (1) the origination of a temporary difference
Deferred Tax Liability
Future tax obligation that results from the origination of a temporary
A non-cash expense that provides a source of free cash flow. Amount allocated during the
Demand line of credit
A bank line of credit that enables a customer to borrow on a daily or on-demand basis.
Depreciation tax shield
The value of the tax write-off on depreciation of plant and equipment.
depreciation tax shield
Reduction in taxes attributable to the depreciation allowance.
Disability Insurance (Credit Insurance)
Group Insurance designed to cover monthly obligations due to a borrower being unable to work due to sickness or injury.
Dividend reinvestment plan (DRP)
Automatic reinvestment of shareholder dividends in more shares of a
Agreement between two countries that taxes paid abroad can be offset against
earnings before interest and income tax (EBIT)
A measure of profit that
Earnings before interest and taxes (EBIT)
A financial measure defined as revenues less cost of goods sold
Earnings before interest and taxes (EBIT)
The operating profit before deducting interest and tax.
Earnings before interest, taxes, depreciation and amortization (EBITDA)
The operating profit before deducting interest, tax, depreciation and amortization.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
An earningsbased measure that, for many, serves as a surrogate for cash flow. Actually consists of working
EBDDT - Earnings before depreciation and deferred taxes
This measure is used principally by
Effective Tax Rate
The total tax provision divided by pretax book income from continuing
Electronic Federal Tax Payment Systems (EFTPS)
An electronic funds transfer system used by businesses to remit taxes to the government.
Through equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock.
Equivalent taxable yield
The yield that must be offered on a taxable bond issue to give the same after-tax
Intermediate-term loans of Eurocurrencies made by banking syndicates to corporate and
Revolving credit without maturity.
Expected return on investment
The return one can expect to earn on an investment. See: capital asset
Export Credit Insurance
The granting of insurance to cover the commercial and political risks of selling in foreign markets.
Federal credit agencies
Agencies of the federal government set up to supply credit to various classes of
Federal Unemployment Tax Act (FUTA)
A federal Act requiring employers to pay a tax on the wages paid to their employees, which is then used to create a
Five Cs of credit
Five characteristics that are used to form a judgement about a customer's creditworthiness:
Foreign direct investment (FDI)
The acquisition abroad of physical assets such as plant and equipment, with
Foreign tax credit
Home country credit against domestic income tax for foreign taxes paid on foreign
Formalized Line of Credit
A contractual commitment to make loans to a particular borrower up to a specified maximum during a specified period, usually one year.
Full Credit Period
The period of trade credit given by a supplier to its customer.
Full faith-and-credit obligations
The security pledges for larger municipal bond issuers, such as states and
Future investment opportunities
The options to identify additional, more valuable investment opportunities
guaranteed investment certificate (GIC)
A GIC is an investment that gives you a guaranteed rate of return over a fixed period of time, usually between 30 days and 5 years. GICs are available from banks, trust companies, and other financial institutions.
Guaranteed investment contract (GIC)
A pure investment product in which a life company agrees, for a
Imputation tax system
Arrangement by which investors who receive a dividend also receive a tax credit for
What the business paid to the IRS.
A government tax on the income earned by an individual or corporation.
Income Tax Expense
See income tax provision.
Income Tax Provision
The expense deduction from pretax book income reported on the
taxes paid by consumers when they buy goods and services. A sales tax is an example.
The loss in purchasing power due to inflation eroding the real value of financial assets such as cash.
Insurance Policy (Credit Insurance)
A policy under which the insurance company promises to pay a benefit of the person who is insured.
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