Note 11 - Income Taxes

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE

11

– INCOME TAXES

A reconciliation of the effective tax rate of the income tax benefit and the statutory income tax rates applied to the loss before income taxes is as follows for the

three

-months ended

March 

31:

	2019			2018
Income tax benefit at Canadian statutory rate		26.5	%		26.5	%
Valuation allowance		(26.5	%)		(26.5	%)
Effective income tax rate		0	%		0	%

As of

March 31, 2019,

the Company has net operating loss carry forwards of approximately

$37,800,000

that

may

be available to reduce future years’ taxable income. Such carry forwards typically expire after

20

years. The Company currently has carry forwards that begin to expire in

2034.

Future tax benefits which

may

arise as a result of these losses have

not

been recognized in these condensed consolidated financial statements, because the Company believes that it is more likely than

not

that the carryforwards will expire unused and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards. The deferred tax asset and associated valuation allowance are as follows for the period ended

March 31, 2019

and the year ended

December 31, 2018:

	2019			2018
Deferred tax asset - net operating losses	$	10,000,000		$	9,700,000
Deferred tax asset valuation allowance		(10,000,000	)		(9,700,000	)
Net deferred tax asset	$	-		$	-

The change in the valuation allowance amounted to

$300,000

and

$400,000

for the

three

-months ended

March 31, 2019

and

2018,

respectively. All other temporary differences are immaterial both individually and in the aggregate to the condensed consolidated financial statements.

Company management analyzes its income tax filing positions in Canadian federal and provincial jurisdictions where it is required to file income tax returns, for all open tax years in these jurisdictions, to identify potential uncertain tax positions. As of

March 31, 2019,

there are

no

uncertain income tax positions taken or expected to be taken that would require recognition of a liability or disclosure in the condensed consolidated financial statements. The Company is subject to routing audits by taxing jurisdictions; however, there are currently

no

audits for any tax periods in progress. Generally, the Company is

no

longer subject to income tax examinations for years prior to

2015.