| Income tax note |
23. Income tax note
The reconciliation of the combined Canadian federal
and provincial statutory income tax rate of 26.5% (2025 – 26.5%) to the effective tax rate is as follows:
| | |
2026 | | |
2025 | | |
2024 | |
| Net Income/(Loss) before recovery of income taxes | |
| (6,936,421 | ) | |
| 1,011,790 | | |
| (51,159,048 | ) |
| | |
| | | |
| | | |
| | |
| Expected income tax (recovery)/expense | |
| (1,838,152 | ) | |
| 268,124 | | |
| (13,557,148 | ) |
| Difference in foreign tax rates | |
| 18,182 | | |
| 6,871 | | |
| 966 | |
| Listing expense | |
| - | | |
| - | | |
| 10,992,625 | |
| Non-taxable fair value gain adjustment | |
| - | | |
| (1,722,146 | ) | |
| - | |
| Non-deductible R&D costs | |
| 345,121 | | |
| - | | |
| - | |
| Non-deductible loss on loan settlement | |
| - | | |
| 449,196 | | |
| - | |
| Share issue costs booked to equity | |
| (154,187 | ) | |
| (246,802 | ) | |
| - | |
| Other permanent expenses | |
| (26,959 | ) | |
| 1,787 | | |
| 2,061,001 | |
| Change in tax benefits not recognized | |
| 1,655,995 | | |
| 1,242,970 | | |
| 502,556 | |
| Income tax (recovery)/expense | |
| - | | |
| - | | |
| - | |
The following table summarizes the components
of deferred tax as at March 31, 2026 and 2025:
| | |
2026 | | |
2025 | |
| Deferred tax asset | |
| | |
| |
| Non-capital losses carried forward-Canada | |
| 107,253 | | |
| - | |
| Deferred tax liability | |
| | | |
| | |
| Investment in Associate | |
| (107,253 | ) | |
| - | |
| | |
| - | | |
| - | |
Unrecognized deferred tax asset
Deferred taxes are provided as a result of temporary
differences that arise due to the differences between the income tax values and the carrying amounts of assets and liabilities. Deferred
tax assets have not been recognized in respect of the following deductible temporary differences:
| Unrecognized deductible temporary differences | |
2026 | | |
2025 | |
| Equipment | |
| 9,774 | | |
| 4,508 | |
| Restricted interest and financing expenses – Canada | |
| 431,096 | | |
| 764,297 | |
| Share issuance costs and others | |
| 1,024,267 | | |
| 722,097 | |
| Investment in digital assets | |
| 110,242 | | |
| - | |
| Non-capital losses carried forward-Canada | |
| 10,298,392 | | |
| 4,248,226 | |
| Non-capital losses carried forward-Australia | |
| 439,334 | | |
| 431,349 | |
| | |
| 12,313,106 | | |
| 6,170,477 | |
Share issuance and financing costs will be fully
amortized in 2030.
The Company’s non-capital loss carry forwards
will expire as noted in the table below:
| Year of expiry | |
Canada | | |
Australia | |
| 2044 | |
| 364,008 | | |
| - | |
| 2045 | |
| 3,479,491 | | |
| - | |
| 2046 | |
| 6,454,894 | | |
| - | |
| Indefinite | |
| - | | |
| 439,334 | |
| Total | |
| 10,298,393 | | |
| 439,334 | |
|