10 Canadian tax & accounting terms starting with D
Plain-language definitions, each with the CRA rule it comes from and the filings it affects.
Debt-to-Equity Ratio
The debt-to-equity ratio compares a business's total debt to its shareholders' equity, measuring how much it relies on borrowing versus owner financing.
Deemed Disposition
A deemed disposition is when tax law treats you as having sold a property at fair market value even though no actual sale occurred, triggering a capital gain or loss.
Deferred Revenue
Deferred revenue is money received from a customer for goods or services you have not yet delivered, recorded as a liability until you earn it.
Deferred Tax
Deferred tax is an accounting item reflecting timing differences between when income or expenses are recognised for accounting versus for tax, creating future tax assets or liabilities.
Departure Tax
Departure tax is the tax on the accrued gains of your property when you cease to be a Canadian resident, based on a deemed disposition at fair market value.
Depreciation
Depreciation is the accounting method of spreading the cost of a tangible asset over its useful life, reflecting wear, age and obsolescence.
Director
A director is a person elected by shareholders to oversee a corporation's management and affairs, carrying legal duties and, in some cases, personal liability.
Dividend
A dividend is a distribution of a corporation's after-tax profits to its shareholders, taxed at preferential personal rates through the dividend tax credit.
Dividend Tax Credit
The dividend tax credit reduces the personal tax on dividends from Canadian corporations, recognising that the company already paid corporate tax on the underlying profits.
Double-Entry Bookkeeping
Double-entry bookkeeping records every transaction in at least two accounts, a debit and an equal credit, so the books always stay in balance.
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