16. INCOME TAXES
The relationship between the expected tax expense based on the combined federal and provincial income tax rate in Canada and the reported tax expense in the consolidated statement of comprehensive income can be reconciled as follows:
|
|
|
|
For the years ended |
|
|||||||
|
|
|
|
2017 |
|
2016 |
|
2015 |
|
|||
|
|
Loss before income taxes |
|
$ |
(22,424,293 |
) |
$ |
(86,294,370 |
) |
$ |
(26,563,139 |
) |
|
|
Statutory tax rate |
|
|
26.00 |
|
|
26.00 |
|
|
26.00 |
|
|
|
Recovery of income taxes based on the combined Canadian |
|
|
|
|
|
|
|
|
|
|
|
|
federal and provincial statutory rates |
|
|
(5,830,316 |
) |
|
(22,436,536 |
) |
|
(6,906,416 |
) |
|
|
Share-based remuneration |
|
|
650,335 |
|
|
468,939 |
|
|
1,061,468 |
|
|
|
Effect of rate change |
|
|
(2,344,122 |
) |
|
— |
|
|
— |
|
|
|
Foreign exchange adjustment |
|
|
(28,668 |
) |
|
333,276 |
|
|
126,654 |
|
|
|
Other permanent differences |
|
|
(1,798,205 |
) |
|
(8,821,908 |
) |
|
(2,352,402 |
) |
|
|
Unrecognized deferred tax benefits |
|
|
9,670,642 |
|
|
30,531,995 |
|
|
8,191,467 |
|
|
|
Difference in tax rates between foreign jurisdictions and Canada |
|
|
164,762 |
|
|
124,757 |
|
|
46,580 |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Income tax expense |
|
$ |
484,428 |
|
$ |
200,523 |
|
$ |
167,351 |
|
|
|
|
|
|
|
|
|
|
|
|||
The components of income tax expense are shown in the following table:
|
|
|
|
For the years ended |
|
|||||||
|
|
|
|
2017 |
|
2016 |
|
2015 |
|
|||
|
|
Current tax |
|
$ |
484,428 |
|
$ |
200,523 |
|
$ |
167,351 |
|
|
|
Deferred tax |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Income tax expense |
|
$ |
484,428 |
|
$ |
200,523 |
|
$ |
167,351 |
|
|
|
|
|
|
|
|
|
|
|
|||
The Company recorded no deferred tax assets in the consolidated statement of financial position as it is not yet probable that future taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilized. The unrecognized deferred tax assets include tax losses, research and development pools and differences between the carrying amount and the tax basis of the following items:
|
|
|
|
For the years ended |
|
|||||||
|
|
Deferred tax assets |
|
2017 |
|
2016 |
|
2015 |
|
|||
|
|
Investment tax credits |
|
$ |
3,108,576 |
|
$ |
2,689,744 |
|
$ |
3,454,503 |
|
|
|
Capital assets |
|
|
500,445 |
|
|
328,039 |
|
|
212,311 |
|
|
|
Share issue expenses |
|
|
1,774,820 |
|
|
772,687 |
|
|
999,066 |
|
|
|
Non-capital loss carry forwards |
|
|
56,627,473 |
|
|
22,828,376 |
|
|
15,639,367 |
|
|
|
Foreign exchange |
|
|
5,500 |
|
|
(12,388 |
) |
|
1,093 |
|
|
|
Research and development expenditures |
|
|
265,260 |
|
|
68,037 |
|
|
3,523,925 |
|
|
|
Reserve for legal damages |
|
|
— |
|
|
28,205,068 |
|
|
— |
|
|
|
Deferred compensation |
|
|
31,387 |
|
|
50,454 |
|
|
29,907 |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
$ |
62,313,461 |
|
$ |
54,930,017 |
|
$ |
23,860,172 |
|
|
|
|
|
|
|
|
|
|
|
|||
Included in the Company's deferred tax assets not recognized above as at December 31, 2017, is $982,443 of research and development expenditures available to reduce taxable income in the future periods with no expiry date. The Company has loss carry forward balances for income tax purposes of $233,544,898 that are available to reduce taxable income in Canada in the future periods, if any, expiring at various times through to the year 2037. The Company also has investment tax credits of $3,769,799 available to reduce income taxes in the future periods, expiring at various times through to the year 2037.