Daemons, like boggarts, are spirit entities, but they are much more powerful and intelligent. They have complete control of their shape and appearance, becoming visible or invisible at will. They also have highly developed language skills. Some of them aspire to be gods, like the old gods, and spend their time trying to augment their power at the expoense of their human victims. The stronger one wants to be worshipped.
A daemon can be of a spectrum of power levels, with the strongest being able to convert into Gods. Much like how daemons can become gods, boggarts can be converted into daemons, either by simply becoming more powerful or by undergoing a powerful ritual like Raknid, who was converted from a boggart to a spider-like daemon by the Malkin Clan.