Income Taxes

12 Months Ended

Feb. 28, 2019

Notes to Financial Statements

Note 11 - Income Taxes

The following table reconciles the income tax benefit at the statutory rates to income tax benefit at the Company’s effective tax rate.

	2019 $			2018 $
Net loss before taxes		(1,311,591	)		(3,523,632	)
Statutory tax rate		21	%		34	%
Expected income tax recovery		275,434			1,198,035
Permanent differences and other		(42,725	)		(299,362	)
Change in enacted tax rate		–			1,101,538
Change in valuation allowance		(232,709	)		202,865
Income tax provision		–			–

Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting processes. Deferred income tax assets and liabilities at February 28, 2019 and 2018 are comprised of the following:

	2019 $			2018 $
Net operating losses carried forward		2,012,119			1,779,410
Valuation allowance		(2,012,119	)		(1,779,410	)
Net deferred tax asset		–			–

The 2017 Act reduces the corporate tax rate from 34% to 21% for tax years beginning after December 31, 2017. For net operating losses arising after December 31, 2017, the 2017 Act limits a taxpayer’s ability to utilize net operating losses carryforwards to 80% of taxable income. In addition, net operating losses arising after 2017 can be carried forward indefinitely, but carryback is generally prohibited. Net operating losses generated in tax years beginning before January 1, 2018 will not be subject to the taxable income limitation. The 2017 Act would generally eliminate the carryback of all net operating losses arising in a tax year ending after 2017 and instead would permit all such net operating losses to be carried forward indefinitely.

As at February 28, 2019, the Company is in arrears on filing its statutory corporate income tax returns and the amounts presented above are based on estimates. The actual losses available could differ from these estimates.