GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

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Ordinary Dividends


Synonyms:annual dividends, periodic dividends, quarterly dividends
Filed Under: financial-banking, investments, taxation
Tags: banking, investment, taxes
 

Definition of ordinary dividends

ordinary dividends
1. Dividends that are distributions of a company's profits. They are fully taxable.

Related Terms and Acronyms:

  • business (busn)   A company, either for-profit or non-profit.
  • capital gain (CG)   The profit made by the seller when real estate or other capital assets are sold. Capital gains are taxed more favourably than earned income. However, this can be dependent on your tax bracket and the length of time you owned the asset before it was sold. You could pay approximately one-third to one-half less tax than you would pay on the same amount of earned salary.
  • capital gain distribution   When the fund sells some of its assets, you receive capital gain distributions or a portion from the sale. This distribution is regarded as a capital gain, not as ordinary dividends such as the interest gained from a bank account. It is important to separate capital gain distributions from ordinary dividends because capital gains are taxed more favourably.
  • capital gains tax (CGT)   A tax on profits from the sale of real estate or investments.
  • dividend   Distribution of earnings to shareholders. In credit unions, it's the money paid to members for deposits, similar to the interest banks pay to their customers for deposits.
  • investment income   Income that is earned from investments such as interest, dividends, and capital gains.
  • ordinary income   Income that does not qualify as a capital gain including wages, interest, dividends, and net income from a business.
  • profit   When revenues exceed expenses.
  • taxable income   Income that is subject to taxation after accounting for adjustments, exemptions, and deductions.

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