Investment Glossary · Quick read · No ads
Effective Tax Rate
The short answer
The average rate at which a company or individual is actually taxed on income, calculated by dividing total tax paid by taxable income.
What is Effective Tax Rate?
The average rate at which a company or individual is actually taxed on income, calculated by dividing total tax paid by taxable income.
About this page. Written by Associate Professor Charles Lo, CPA, PhD. Checked against reliable sources before publication. No ads and no paywall. Editorial standards · How we fact check · Corrections log · Report an error
Educational information only. Nothing on this page is personal financial, tax or legal advice. Investing involves risk, including the possible loss of principal.
