NBR ITP key terms

The total income a person receives in a year that is subject to tax under the Income Tax Act, before deducting allowable expenses, exemptions, and losses.

Assessable income reduced by allowable deductions, set-off of losses, and any exemptions, forming the base on which income tax is computed at the applicable rates.

An expense incurred wholly and exclusively in producing assessable income that the law permits to be subtracted, such as rent, salaries, and depreciation on qualifying assets.

A statutory deduction spread over several years that gives relief for the cost of qualifying capital assets used in a business, instead of deducting the full cost at once.

The accounting allocation of an asset's cost over its useful life; for tax purposes it is generally replaced by capital allowances and is not itself an allowable deduction.

The test determining whether an individual is taxed on worldwide income or only on income from sources within the country, usually based on days present or domicile.

The principle that decides which country may tax a particular item of income by reference to where the activity, asset, or payer generating it is located.

A tax deducted at source by a payer from payments such as dividends, interest, royalties, or service fees, and remitted to the revenue authority on the recipient's behalf.

An amount subtracted directly from the tax otherwise payable, often granted for tax already paid abroad or withheld at source, so it reduces the liability itself.

The imposition of comparable taxes by two jurisdictions on the same income or capital, typically relieved through tax treaties, credits, or exemptions.

A bilateral agreement between states that allocates taxing rights, prevents double taxation, and often reduces withholding rates on cross-border payments.

A rate structure in which the marginal tax rate rises as the tax base increases, so higher slices of income bear a larger percentage of tax.

The prescribed form on which a taxpayer reports income, deductions, and tax payable for a period, and which forms the basis of an assessment.

A system in which the taxpayer computes its own liability and files a return, with the revenue authority later verifying the figures through audits and risk checks.

The formal determination by the revenue authority of the amount of tax payable for a period, whether based on a filed return or on the authority's own estimate.

Any individual, company, partnership, or other entity that is legally obliged to register and account for a given tax under the governing statute.

A supply of goods or services made in the course of business for consideration, which is not exempt and therefore falls within the charge to VAT.

A supply that the law excludes from VAT, so no output tax is charged and the supplier generally cannot recover input tax attributable to it.

A taxable supply charged at a rate of zero percent, allowing the supplier to recover related input tax while charging no VAT to the customer.

The VAT a registered business charges on its taxable supplies and must account for to the revenue authority, usually shown separately on invoices.

VAT paid by a registered business on purchases and expenses used for taxable supplies, which may be credited against output tax or refunded.

A document meeting prescribed content requirements that a supplier issues on a taxable supply and that supports the customer's claim to input tax.

The level of taxable turnover above which a business must register for VAT, and below which registration is generally optional.

The statutory rule identifying the jurisdiction in which a supply is treated as made, determining whether and where VAT applies.

A mechanism shifting the duty to account for VAT from the supplier to the recipient, commonly applied to imported services and certain domestic supplies.

The periodic statement on which a registered person reports output tax, input tax, and the net amount payable or refundable for the period.

The value of imported goods determined under valuation rules, usually the transaction value adjusted for freight, insurance, and specified additions or deductions, on which duty is charged.

A tax levied on goods at the point of import or export, assessed on the customs value, quantity, or both, according to the tariff schedule.

The process of assigning imported goods to a specific heading in the customs nomenclature, which determines the applicable duty rate and any restrictions.

Criteria that establish the country in which goods are deemed to originate, used to apply preferential tariff rates and trade remedy measures.

A reduced or nil duty rate available under a trade agreement or unilateral concession, applied only where the goods meet the relevant origin rules.

A duty expressed as a percentage of the customs value of the goods, so the amount payable rises and falls with the declared value.

A duty fixed at a set amount per unit of weight, volume, or quantity, irrespective of the value of the goods concerned.

A secured facility approved by customs in which imported goods may be stored with duty suspended until they are cleared for home use or re-exported.

A tax imposed on specific goods, typically alcohol, tobacco, fuel, and certain luxury items, at manufacture, import, or release for consumption.

Goods listed in the excise schedule as subject to excise duty, defined by tariff heading or description, and liable on production or importation.

A physical or digital mark affixed to excisable goods to evidence that duty has been paid, used to detect untaxed or counterfeit products.

An additional charge levied on top of a primary tax or duty, often calculated as a percentage of that tax to fund a specific purpose or discourage certain conduct.