Income Taxes

12 Months Ended

Aug. 31, 2020

Major components of tax expense (income) [abstract]

20. Income Taxes

a) Provision for Income Taxes

The following table reconciles the income tax provision from the expected income tax amount based on the statutory rates to the amount recognized in the statements of comprehensive loss:

	August 31, 2020			August 31, 2019			August 31, 2018

Net loss for the year before income taxes	$	5,414,745		$	3,541,011		$	3,458,976
Combined Canadian federal and provincial tax rate		25.0%			25.0%			25.1%

Expected income tax recovery at statutory rates		1,353,686			885,253			868,203
Share based compensation		(25,329	)		(19,711	)		(37,620	)
Non-deductible financing transaction costs		(—	)		(20,074	)		(89,678	)
Other non-deductible expenses		(3,012	)		(736	)		(2,864	)
CEE incurred applied to flow-through shares		(55,395	)		(179,086	)		(476,559	)
Amortization of flow-through share premium		47,481			154,676			218,232
Non-taxable (non-deductible) change in fair value warrants of financial instruments		(18,033	)		(62,434	)		6,706
Losses and other deductions for which no benefit has been recognized		(1,251,917	)		(603,212	)		(268,188	)

Deferred income tax recoveries	$	47,481		$	154,676		$	218,232

b) Income Tax Effect of Temporary Differences Recognized

The tax effects of temporary differences recognized as at August 31, 2020 and August 31, 2019 are as follows:

		August 31, 2020			August 31, 2019
Deferred income tax assets
Exploration and evaluation assets	$	6,281,863		$	4,721,336
Scientific research and experimental developmental expenditures		4,294,187			5,424,332
		10,576,050			10,145,668
Deferred income tax liabilities
Property plant and equipment		(10,576,050	)		(10,145,668	) ⁽¹⁾

Net deferred income tax assets	$	—		$	—

⁽¹⁾ Included the deferred income tax liability related to the carrying amount of Asset Held for Sale.

c) Income Tax Temporary Differences Not Recognized

The deductible income tax temporary differences that have not been recognized as deferred income tax assets as at August 31, 2020 and August 31, 2019 are as follows:

	August 31, 2020		August 31, 2019

Non-capital loss carryforwards	$	35,733,583	$	35,630,141
Scientific research and experimental developmental expenditures		10,191,008		5,670,428
Share issuance costs		291,203		458,359
Capital loss carry forwards		2,294,535		2,294,535
Lease obligation		867,467		—

Deductible temporary differences not recognized	$	49,377,796	$	44,053,463

The Company also has non-refundable investment tax credit carry forwards of $5,687,308 (2019 - $5,701,467), which has not been recognized as a deferred income tax asset.

d) Non-Capital Losses

The Company has non-capital losses carried forward of approximately $34,066,000 (2019 - $33,963,000, 2018 - $31,793,000) available to reduce future years' Canadian taxable income. These losses will expire as follows:

2026	$	156,000
2027		232,000
2028		847,000
2029		914,000
2030		1,584,000
2031		3,050,000
2032		3,601,000
2033		4,151,000
2034		4,211,000
2035		4,397,000
2036		3,008,000
2037		2,805,000
2038		2,837,000
2039		2,170,000
2040		103,000

The Company also has net operating losses of approximately $1,668,000 (2019 - $1,668,000, 2018 - $1,668,000) to reduce future years' U.S. taxable income. These losses will expire as follows:

2031	$	5,000
2032		2,000
2033		3,000
2034		1,658,000

e) Capital Losses

The Company has capital losses carried forward of approximately $2,295,000 (2019 - $2,295,000, 2018 - $2,295,000) available to reduce future years' Canadian taxable capital gains.