NOTE 23 INCOME TAXES

12 Months Ended

Dec. 31, 2020

NOTE 23 INCOME TAXES

INCOME TAXES

23. INCOME TAXES

a) Rate reconciliation

Income tax expense differs from the amount that would result by applying the combined Canadian federal and provincial income tax rates to earnings before income taxes. The reconciliation of the combined Canadian federal and provincial statutory income tax rate of 27% (2019 - 27%, 2018 – 27%) to the effective tax rate is as follows:

	Years ended December 31,
	2020			2019			2018
	$			$			$
Loss before taxes		(17,066,311	)		(4,301,663	)		(3,789,918	)
Combined Canadian federal and provincial income tax rates		27	%		27	%		27	%
Expected income tax recovery		(4,607,900	)		(1,161,450	)		(1,023,280	)
Items that cause an increase (decrease):
Effect of different tax rates in foreign jurisdiction		24,800			82,490			35,690
Non-deductible expenses less other permanent differences		217,225			(367,360	)		294,780
Loss on change in fair value of warrant liability		3,209,435			-			-
Tax rate changes		(74,050	)		8,700			152,650
Share issuance costs and other		(1,910	)		(36,010	)		1,690
Change in tax benefits not recognized		1,232,400			1,473,630			538,470
Income tax recovery		-			-			-

b) Unrecognized deferred tax assets and liabilities

Deferred taxes are provided as a result of temporary differences that arise due to the differences between the income tax values and the carrying amount of assets and liabilities. Deferred tax assets have not been recognized in respect of the following deductible temporary differences:

	As at December 31,
	2020			2019
	$			$
Deferred tax assets:
Non-capital losses		19,890,140			11,870,240
Property and equipment		(1,007,630	)		31,080
Intangible assets		674,140			485,390
Right-of-use assets net of lease liability		13,530			25,060
Accrued fees and compensation		-			264,360
Share issue costs		308,660			340,880
Capital losses carried forward		5,420			5,420
Unrealized foreign exchange loss		1,880			1,880
Goodwill		2,216,710			2,266,520
Deferred tax assets, net		22,102,850			15,290,830

c)   Expiration of income tax loss carry forwards

As at December 31, 2020, the Company has $11,742,879 of Canadian non-capital income tax losses (unrecognized) which will expire over 2036 through 2040, and $8,147,261 of United States net operating losses (unrecognized) of which $2,688,420 will expire over 2036 through 2038, and $5,458,841 which are indefinite.