v3.25.2
INCOME TAX
 12 Months Ended
Apr. 30, 2025
INCOME TAX  
INCOME TAX

NOTE 12 - INCOME TAX

 

The Company provides for income taxes under ASC 740, “Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

The reconciliation of the net operating loss for year ended April 30, 2025, and 2024 is shown as follows:

 

 

 

Year Ended

 

 

 

April 30,

 

 

April 30,

 

 

 

2025

 

 

2024

 

Net loss

 

$(4,335,319)

 

$(4,937,934)

Add: Stock based compensation

 

 

1,591,571

 

 

 

1,738,442

 

Net operating loss

 

$(2,743,748)

 

$(3,199,492)

 

The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of April 30, 2025, and 2024 are as follows:

 

 

 

April 30,

 

 

April 30,

 

 

 

2025

 

 

2024

 

Net operating loss carryforward

 

$(9,691,129)

 

$(6,947,381)

Effective tax rate

 

 

21%

 

 

21%

Deferred tax asset

 

 

(2,035,137)

 

 

(1,458,950)

Less: Valuation allowance

 

 

2,035,137

 

 

 

1,458,950

 

Net deferred asset

 

$-

 

 

$-

 

 

The valuation allowance increased by $576,187 and $671,893 during the years ended April 30, 2025, and 2024, respectively. As of April 30, 2025, the Company had approximately $9.7 million in net operating losses (“NOLs”) that may be available to offset future taxable income, which begin to expire between 2036 and 2038. NOLs generated in tax years prior to April 30, 2018, can be carried forward for twenty years, whereas NOLs generated after April 30, 2018, can be carried forward indefinitely. In accordance with Section 382 of the U.S. Internal Revenue Code, the usage of the Company’s net operating loss carry forwards is subject to annual limitations following greater than 50% ownership changes. Tax returns for the years ended 2016 through 2025 are subject to review by the tax authorities.

 

The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the provisions of Section 740-10-25 for the years ended April 30, 2025, or 2024. The Company recognizes interest accrued related to unrecognized tax benefits in interest expenses and penalties in operating expenses. No such interest or penalties were recognized during the periods presented. The Company had no accruals for interest and penalties on April 30, 2025, or 2024. Tax returns for the years ending 2016 through 2025 are subject to review by the tax authorities.