Glossary term
Eligible dividend
An eligible dividend is a Canadian taxable dividend category with enhanced gross-up and dividend tax credit treatment.
Plain meaning
What eligible dividend means
Eligible dividends receive a specific tax treatment. The taxable amount is grossed up, and a dividend tax credit is then applied. This can make the tax effect different from salary, interest, capital gains, or non-eligible dividends.
Calculator context
How OpenBook uses it
Dividend tax calculators use eligible dividend gross-up and credit assumptions to estimate tax effects. The estimate depends on taxable income, province or territory, and the tax year or data set being used.