| Income taxes |
A
reconciliation of the effective tax rate to the statutory rate is shown below:
Schedule of reconciliation of provision of income tax
| | |
December 31, 2025 | | |
December 31, 2024 | |
| | |
| | |
| |
| | |
| | | |
| | |
| Expected income tax credit at statutory rate of 25% | |
$ | (1,761,498 | ) | |
$ | (334,923 | ) |
| Increase (decrease) in income taxes resulting from: | |
| | | |
| | |
| Valuation allowance for deferred tax asset | |
| 75,228 | | |
| 345,515 | |
| IPO related-expenses | |
| 75,000 | | |
| 75,000 | |
| Interest income from note receivables | |
| (21,301 | ) | |
| (31,875 | ) |
| Unrealized loss (gain) on investments | |
| 1,163,620 | | |
| (19,420 | ) |
| Gain on change in fair value of convertible notes | |
| (771,520 | ) | |
| - | |
| Non-tax deductible personnel expenses | |
| 27,397 | | |
| 13,615 | |
| Non-tax deductible consulting fees | |
| 733,653 | | |
| 143,665 | |
| Non-tax deductible general and administrative expenses | |
| 210,235 | | |
| 115,953 | |
| Non-tax deductible finance costs and interest expenses | |
| 273,553 | | |
| - | |
| Other items, net | |
| (4,367 | ) | |
| 32,821 | |
| Income tax credit | |
$ | - | | |
$ | 340,351 | |
The
tax effects of temporary differences that gave rise to the deferred tax assets and liabilities are as follows:
Schedule of components of deferred tax assets
| | |
December 31, 2025 | | |
June 30, 2025 | |
| Deferred tax assets: | |
| | | |
| | |
| Accrued employee benefits | |
$ | 47,399 | | |
$ | 41,582 | |
| Unrealized foreign exchange gain (loss) | |
| 281 | | |
| (1,264 | ) |
| Depreciation | |
| (4,397 | ) | |
| (5,031 | ) |
| Operating right of use assets and lease liabilities | |
| 6,193 | | |
| 5,692 | |
| Accumulated tax loss | |
| 414,720 | | |
| 347,990 | |
| Valuation allowance for deferred tax asset | |
| (464,196 | ) | |
| (388,969 | ) |
| Net deferred tax asset | |
$ | - | | |
$ | - | |
As
of December 31, 2025 and June 30, 2025, the Company had no material net operating loss or tax credit carry forwards. As of December 31,
2025 and June 30, 2025, the Company had no provision for uncertain tax positions and no provisions for penalties or interest. In addition,
the Company does not believe that there are any uncertain tax benefits that could be recognized in the near future that would impact
the Company’s effective tax rate. For the six-month periods ended December 31, 2025 and 2024, the change in valuation allowance
totaled $75,228
and $345,515,
respectively.
|