A direct dollar-for-dollar reduction in tax allowed for expenses such as child care and R&D for building low-income housing. Compare tax deduction. Bloomberg Financial Dictionary
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Additional amount on dividends paid by a company resident in France to alleviate double taxation. Euroclear Clearing and Settlement glossary
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Dividends payments are received in net because companies are required to deduct tax when paying out a dividend. If your rate of tax is lower than the rate paid by the company, then you are allowed to receive the difference as tax credit.
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tax credit UK US noun [C] TAX
► an amount of money calculated according to someone's personal situation that reduces the amount of tax they must pay: »
The tax credit will cost taxpayers $6.4 billion a year by the time all the nation's ethanol plants under construction are completed.
a tax credit for sth »The bill proposes a 65% tax credit for donations to private scholarship funds.
get/receive/take a tax credit »The Work Opportunity Tax Credits allows companies to take tax credits between $1,500 and $2,400 for each new employee hired among the eligible groups.
»a production/investment/energy tax credit
child/dividend/working tax credits »Working tax credits are intended to fund childcare when parents return to work.
Financial and business terms. 2012.