v3.25.3
TAXES ON INCOME
 12 Months Ended
Jul. 31, 2025
Income Tax Disclosure [Abstract]  
TAXES ON INCOME

NOTE 11: TAXES ON INCOME

 

a. Components of income taxes excluding cumulative effects of changes in accounting principles, other comprehensive income, and equity in net results of affiliated companies accounted for after-tax for the years ended July 31 were as follows:

 

b. The Company recorded loss before taxes on income as follows:

 

   2025   2024 
   Year ended July 31, 
   2025   2024 
     
Domestic  $(23,999,920)   $23,946,952)
Foreign   (2,556,220)   (28,878,500)
Loss before taxes on income  $(26,556,140)  $(4,931,548)

 

 

BriaCell Therapeutics Corp

Notes to the Consolidated Financial Statements

For the Years Ended July 31, 2025 and 2024

(Expressed in US Dollars, except share and per share data and unless otherwise indicated)

 

NOTE 11: TAXES ON INCOME (Cont.)

 

c. The reconciliation of the combined Canadian federal and provincial statutory income tax rate of 27% (2024 - 27%) to the effective tax rate is as follows:

 

   2025   2024 
   Year ended July 31, 
   2025   2024 
         
Net loss before recovery of income taxes  $(26,556,140)  $(4,931,548)
Expected income tax (recovery) expense   (7,170,160)   (1,331,518)
Tax rate changes and effect of taxes of subsidiaries at foreign rates   1,448,710    1,467,021 
Share-based compensation and other non-deductible expenses   240,070    1,697,204 
Share issuance cost booked directly to equity   

(375,750

)   

-

 
Adjustments in respect of prior periods   

868,490

    

-

 
R&D Credits   (1,284,010)   (3,903,153)
Effect of spin-out transaction   -    (297,781)
Valuation allowance   6,272,650    2,368,228 
Income tax (recovery)  $-   $- 

 

d. The Company had no income tax expense for the years ended July 31, 2025, and 2024, due to its history of operating losses and valuation allowances.

 

e. Significant components of the Company’s deferred tax assets are as follows:

 

   2025   2024 
   July 31, 
   2025   2024 
Deferred Tax Assets:          
Property and equipment  $730    731 
Marketable Securities   11,760    15,678 
Intellectual property   260,860    256,741 
Warrant liability   -    - 
Share issuance costs   310,230    376,978 
Investment in BC Therapeutics   44,650    19,172 
Operating tax losses carried forward   5,067,840    4,850,799 
Operating tax losses carried forward- USA   8,494,300    5,545,125 
Research and Development   14,240,640    10,879,373 
Total deferred tax assets   28,431,010    21,944,597 
Valuation allowance   (24,329,720)   (18,034,710)
Net deferred tax assets  $4,101,290   $3,909,887 
           
Deferred Tax Liability:          
Intellectual Property  $-   $- 
Warrant liability   (4,053,520)   (3,848,762)
Property, plant, and equipment   (47,770)   (61,125 
Total net deferred tax liabilities   (4,101,290)   (3,909,887)
Valuation allowance   -    - 
Net deferred tax assets (liabilities)  $-   $- 

 

  f.

The Company has net deferred tax assets relating primarily to net operating loss (“NOL”) carryforwards, research and development, and share issuance costs. Subject to certain limitations, the Company may use these deferred tax assets to offset taxable income in future periods. Due to the Company’s history of losses and uncertainty regarding future earnings, a full valuation allowance has been recorded against the Company’s deferred tax assets, as it is more likely than not that such assets will not be realized. The net change in the total valuation allowance for the year ended July 31, 2025, was $1,792,500.

 

 

BriaCell Therapeutics Corp

Notes to the Consolidated Financial Statements

For the Years Ended July 31, 2025 and 2024

(Expressed in US Dollars, except share and per share data and unless otherwise indicated)

 

NOTE 11: TAXES ON INCOME (Cont.)

 

At July 31, 2025, the Company had US federal NOL carryforwards of approximately $40,450,000. The federal net operating losses have expiry periods ranging between 2033 and indefinitely. The Company also has Canadian net operating loss carryovers of approximately $18,770,000 as of July 31, 2025. The Canadian net operating losses have expiry periods ranging between 2035 and 2045.

 

The Company has adopted the provisions of ASC 740-10, which clarifies the accounting for uncertain tax positions. ASC 740-10 requires that the Company recognize the impact of a tax position in its financial statements if the position is more likely than not to be sustained upon examination based on the technical merits of the position. For the year ended July 31, 2025, the Company had no material unrecognized tax benefits, and based on the information currently available, no significant changes in unrecognized tax benefits are expected in the next 12 months.

 

The Company’s policy is to recognize interest and penalties related to uncertain tax positions as income tax expense. The Company has no accruals for interest or penalties on its accompanying consolidated balance sheets as of July 31, 2025, and 2024, and has not recognized interest or penalties in the consolidated statements of operations for the years ended July 31, 2025, and 2024.