10. Income Tax Expense

9 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

Income Tax Expense

10. Income Tax Expense

(a) The components of tax (expense)/income comprise:

	September 30, 2019 (not reviewed)		December 31, 2018
Current tax
- Australia	$	15,620	$	78,224
- US		–		–
Total	$	15,620	$	78,224

(b) The prima facie tax on profit from ordinary activities before income tax is reconciled to income tax as follows:

Profit/(loss) from continuing operations before income tax expense:
- Australia	$	(56,798	)	$	(285,110	)
- US		(7,676,469	)		968,692
Total	$	(7,733,268	)	$	683,582
Income tax expense/(credit) at statutory rate:
- Australia	$	(15,620	)	$	(78,405	)
- US		(1,612,059	)		203,425
Total	$	(1,627,678	)	$	125,020
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Other adjustments		1,612,058			(203,244	)
Consolidated income tax expense/(income)	$	(15,620	)	$	(78,224	)

On December 22, 2017, new tax reform legislation in the U.S., known as the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law. At September 30, 2019, the Company has not yet completed its accounting assessment for the tax effects of the enactment of the Act; however, as described below, the Company has made a reasonable estimate of the effects on the existing deferred tax balances.

As a result of the lower enacted corporate tax rate, the Company has remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. The provisional amount recorded of our tax balance was $1,612,058 that is fully offset by accumulated losses from earlier periods.

Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of US GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. In accordance with SAB 118, the Company has provisionally determined that there is no deferred tax benefit or expense with respect to the remeasurement of certain deferred tax assets and liabilities due to the full valuation allowance against net deferred tax assets. The Company is still analyzing certain aspects of the Act and refining its calculations, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. Additional analysis of the law and the impact to the Company will be performed and any impact will be recorded in the respective quarter in 2019.